Good afternoon, and welcome to C&F Financial Corporation's 2022 Annual Shareholders Meeting. I'm Larry Dillon, Executive Chairman of your corporation, and I now call the annual meeting of shareholders to order. I thank you for your interest as expressed by your participation and proxies. Please note that we will have our usual Q&A session at the end of the meeting. Shareholders who logged into the meeting using their control number are able to submit questions throughout the meeting using the message function, and we will address your questions that are pertinent to shareholders generally at the end of the meeting. Your phone lines will remain on mute during the meeting. Participating in the meeting with me today are Tom Cherry, President and CEO of the corporation, and Jason Long, Secretary of the corporation.
The directors of the corporation are all attending today's virtual meeting, and I would like to introduce each director. The corporation's directors are divided into three classes. The directors in class one, whose terms expire in 2024, are James H. Hudson III, C. Elis Olsson, D. Anthony Peay, Dr. Jeffry O. Smith, and I. The directors in class two, who have been nominated for election to serve until the year 2025, are Audrey D. Holmes, Elizabeth R. Kelley, James T. Napier, and Paul C. Robinson. The directors in class three, whose terms expire in 2023 are Dr. Julie R. Agnew, J.P. Causey Jr., Thomas F. Cherry, and George R. Sisson III. All of the C&F Financial Corporation's directors, as well as Bryan McKernan, who is President and CEO of C&F Mortgage Corporation, also serve as directors of Citizens and Farmers Bank.
This is the annual shareholders meeting of the corporation. Only shareholders of record at the close of business on February 16, 2022, or their duly authorized representatives are entitled to participate in the affairs of this meeting, including voting and asking questions. The proxy committee appointed by the directors consists of James H. Hudson III and I. We will vote all shares that are represented by proxies as directed on the proxies. In addition, the board of directors has appointed Jason E. Long to serve as the inspector of the election for this meeting. He has taken the oath of office and will certify the results of the voting. All C&F Financial Corporation shareholders entitled to vote at this meeting have the ability to do so online during the meeting if you logged into the meeting using your control number.
If you are a shareholder entitled to vote and have not yet voted, or if you want to change your previously cast vote, please do so now via the voting function in the online meeting portal. Please remember that if you have already voted by proxy, it is not necessary for you to vote again. After voting has been completed on all matters on the agenda, we will close the polls, and the inspector of the election will present his preliminary report. Mr. Long, please report on the attendance at this meeting.
Mr. Chairman, the number of proxies received shows that at least 80% of the total outstanding shares entitled to vote are represented by proxy. Therefore, a quorum is present for business to be conducted at this meeting.
Since a quorum is present, the meeting is open for business. Mr. Long, was the notice of the meeting properly mailed?
Yes, sir. The corporation's notice of annual meeting of shareholders and accompanying proxy statement were mailed on or about March 11, 2022 to each shareholder of record as of February 16, 2022. I move the reading of the printed notice of the 2022 annual meeting and the minutes of the 2021 annual meeting be waived.
Moved. Motion and a second. Without objection, it is so ordered. The Secretary has the list of the holders of record of common stock of the company at the close of business on February 16, 2022. The list of shareholders has been opened for examination at the company. This list is available for inspection during this meeting. Any shareholder requesting to review the list should email their name for verification purposes to investor@cffc.com. In addition, the Secretary will file a copy of the list of shareholders with the records of the company. We will now consider and vote on the matters in the proxy statement. It is 3:36 PM, and I declare the polls are open. First proposal to come before the meeting is the election of directors.
The board has nominated Audrey D. Holmes, Elizabeth R. Kelley, James T. Napier, and Paul C. Robinson to serve as class two directors for the term expiring in 2025. Each shareholder has received a proxy statement listing the names of the candidates for election as directors. Proposal 2 is approval of the C&F Financial Corporation 2022 Stock and Incentive Compensation Plan. The board of directors has unanimously recommended that the shareholders approve the plan as described in the proxy statement. Proposal 3 is the advisory vote on the compensation of the corporation's named executive officers. The board of directors has unanimously recommended that the shareholders approve the corporation's executive compensation as described in the proxy statement.
Each shareholder has received a proxy statement describing our approach to executive compensation and providing the details of each named executive officer's compensation. Proposal 4 is the ratification of the appointment of the independent registered public accounting firm. The Board of Directors has appointed Yount, Hyde & Barbour as the corporation's independent registered public accountant for 2022. Since everyone has had the opportunity to vote, it is now 3:38 PM, and I declare the polls are closed. The inspector of the election will now present his preliminary report.
Mr. Chairman, proxies have been voted as follows. Each of the nominees for director received more than 95% of the votes cast in favor of his or her election. The proposal to approve the C&F Financial Corporation 2022 Stock and Incentive Compensation Plan received more than 94% of the votes cast in favor of the proposal. The proposal to approve on an advisory non-binding basis the compensation of our named executive officers as described in the proxy statement received more than 97% of the votes cast in favor of the proposal. The proposal to ratify the appointment of Yount, Hyde & Barbour as the company's independent registered public accounting firm for 2022 received more than 98% of the votes in favor.
I declare the nominees elected. Audrey D. Holmes, Elizabeth R. Kelley, James T. Napier, and Paul C. Robinson will serve until the 2025 annual meeting of shareholders. I declare that the shareholders have voted to approve the C&F Financial Corporation 2022 Stock and Incentive Compensation Plan. I declare that the shareholders have voted in support of the compensation of the corporation's named executive officers as described in the proxy statement.
I declare that the shareholders have ratified the appointment of Yount, Hyde & Barbour as the corporation's independent registered public accountant for 2022. The exact number of shares voted for each proposal will be recorded in the minutes of today's meeting. Attending the meeting today representing Yount, Hyde & Barbour is Justin Crowder. He will be available at the conclusion of the meeting to answer any questions you might have of him. There is no other business to come before this meeting. At this time, Tom Cherry will give a report on the state of the corporation and its operations.
Thank you, Larry. Hello, everyone, and welcome to our 2022 annual shareholders meeting. I'm disappointed that we are once again delivering this meeting virtually versus in person at Stonehouse Operations Center. At the conclusion of last year's meeting, I shared that we would hopefully be back with a live meeting this year, but unfortunately, too many restrictions were still in place at the time the decision had to be made. That won't stop me from saying again, hopefully next year. Let's get started. I'll spend some time with you today talking about certain economic conditions, including inflation and rising interest rates, the pandemic and its impact on our stakeholders, and the war in Ukraine. I will also share highlights from 2021 along with our primary goals and challenges over the next year and beyond. Let's start with inflation and interest rates.
For the past several years, I've spoken about the low interest rate environment and its considerable impact on our margins. The revenue we earn on our assets, i.e., our loans, investments, and other cash was falling faster than we were paying for our deposits and borrowings, resulting in a significant negative impact on our net interest income. The rapid increase in inflation over the last year, which clearly was not transitory as many said in early 2021, along with the negative impact of geopolitical events, led to rising interest rates over the last several months. As expected, the Federal Reserve increased the federal funds rate by 25 basis points at its most recent meeting, with additional increases forecast for future meetings this year. What does all this mean for companies like ours?
To start, the yield on certain of our assets, mainly cash and variable rate loans, will increase in the near term. We don't anticipate the cost of our deposits to immediately increase because of excess liquidity still in the market. Additionally, our borrowings are all priced with fixed rates and therefore will not increase. As a positive result, the net interest margin at the bank should start to increase and lead to an increase in net interest income. This is good news. However, inflation also leads to higher operating expenses for our company and our customers, including families and businesses. It's also important to note that when costs rise for our business customers, their income may also fall. This could result in credit quality issues in the future.
Rising interest rates are also leading to lower originations and income at our mortgage company, a trend we expect to continue throughout 2022. In summary, what does this mean for your company and the financial services industry as a whole? While we anticipate an increasing net margin, we also expect operating costs, loan provision, and eventually interest expense costs to also increase. The exact impact on our company and customers is yet to be known, but we believe we are well-positioned to deal with these issues given our profitability, our capital position, and overall asset liability management practices. Now for the topic that has dominated the news cycle around the world for over 2 years, COVID-19. We're delighted with the recent decline in cases and relaxation of protocols and restrictions, particularly as it relates to kids being back in school.
It's also great to see restaurants, parks, and sporting events well-attended once again in the communities we serve. Our most important concern throughout this pandemic was, and still is, the health and well-being of our employees and their families. For the past two years, we've taken steps both from a physical and financial standpoint to ensure they are safe and able to care for their families, and will continue to do so. I think the most important thing we did was maintaining the continuity of pay and benefits for all of our C&F employees. We have not had any layoffs or cut anyone's pay through the pandemic. We worked incredibly hard to take care of our customers too, continuing to provide crucial financial services to families and businesses, even during the rapid Omicron surge in the fall and winter.
As mentioned last year, the bank was able to help over 1,600 businesses by facilitating over $134 million in forgivable loans through the Paycheck Protection Program, the PPP. We continued working with these businesses throughout 2021 by advising them on loan forgiveness process. To date, $129 million of these loans have been forgiven, which means customers were not required to repay them. We strongly believe we are able to help preserve thousands of jobs by assisting these businesses in the PPP process. It's also clear that our excellent performance with the PPP directly contributed to our financial results by adding new business customers who came to us because we made their PPP loan when other, typically larger banks, were unresponsive.
I would also be remiss if I didn't applaud the efforts of the teammates who kept our branches open the whole way. Their commitment to serving customers was and still very inspiring. Still, 2021 was another difficult year for the communities we serve. We've always believed that continually strengthening local community benefits both citizens and local businesses. C&F Gives Back is our service program to make sure we play a leading role for this purpose in our communities. Our program focuses on promoting volunteerism by encouraging C&F employees, customers, and other stakeholders to make a positive impact in the communities where we live and work. Frankly, these efforts were more needed over the past two years than ever before, and I'm proud we stayed the course.
This mission has been a hallmark of our culture for the past 95 years, and we did a lot for local causes in 2021. However, emerging news reports from Ukraine are simply horrifying, especially the impact seen on Ukrainian families, many of whom are at risk for insufficient food, clothing, and medical supplies. C&F is now supporting Ukrainian families by partnering with PAH, a Polish humanitarian action group serving many of these refugees fleeing the war. An employee at C&F Bank, whose family lives in Poland, shared the story of this relief agency with the company, and that really hit home for us. While most of our charitable efforts focus on the local communities we serve, we knew the pain and suffering these families are experiencing should have our attention.
We also heard from our employees and many of our customers that they would like to help, and that's why we conducted an employee campaign and accepted donations from customers and the community at all C&F locations. Despite the economic and operational challenges presented by the ongoing COVID-19 pandemic, the interest rate environment along with inflationary pressures and other geopolitical events, we are pleased to report that our 2021 financial performance represents the fourth consecutive year of record earnings. Our company's 2021 net income was a record $29.1 million, which is $6.7 million higher than 2020. Total assets for the company are now approaching $2.3 billion. Loans increased to $1.4 billion and deposits grew to $1.9 billion. On a side note, deposits exceeded $2 billion for the first time this month.
Each of our four subsidiaries positively contributed to the overall financial and customer experience successes that have represented the C&F Financial Corporation. As a reminder, we have a mortgage company, a finance company, and a wealth management company, in addition to our full bank. This is the strength of your company, the combination of our diversified lines of business, selfless teamwork, and dedication to providing a great customer experience. 2021's record results were derived from that strength. C&F Mortgage produced net income of $7.7 million in 2021, compared to $10.7 million in 2020. The mortgage company followed its exceptional 2020 originations of $1.8 billion with $1.5 billion in 2021. This represents the second-highest mortgage loan production year in company history.
As mentioned previously, we do anticipate and are already seeing headwinds to the mortgage business in 2022 and beyond as interest rates increase. C&F Finance earnings increased to $10 million in 2021 compared to $7.6 million in 2020. Record loan volumes driven by consumer demand and our competitive business model are behind this team's performance. However, I would never imagine that we would experience no net charge-offs and record low delinquencies from this portfolio, especially given the pandemic. In fact, C&F Finance had net recoveries, meaning we collected more funds from previously charged-off loans than losses on loans we charged off in 2021.
C&F Wealth Management, with over $500 million in assets under management, produced another record revenue performance in 2021, and we continue to be successful at transforming our revenue model to one that is based on assets under management rather than transactional trading fees. This is a win-win strategy because trades are only made when it makes sense for the customer. It also means more consistent revenue streams for the company. Earnings at the bank increased to $13.4 million in 2021 compared to $5.4 million in 2020. The team at C&F Bank focused on service excellence and earning asset growth in 2021. In addition to their great performance serving customers given COVID challenges, total loans outstanding for the bank increased 6.1%, excluding the effect of PPP loans. Deposits also grew strongly in 2021, increasing over 9%.
We are particularly proud of our 16% increase in low-cost consumer and business demand deposits, which helps mitigate margin compression issues I previously mentioned. In summary, we're very pleased with our 2021 results and excited about strategic opportunities at each subsidiary. Yet, we are also mindful of post-pandemic challenges going forward. I'll touch on a few of these topics next. Again, the rising rate environment and continued supply issues with housing will challenge our mortgage company in 2022. As I frequently state, success in the mortgage business is highly driven by the performance and retention of long-term quality loan officers. So this will always be a top priority. Our operating model is strong and it also has capacity, so we continue to grow revenue through Lender Solutions, a program where we provide mortgage operations support to other financial institutions for a fee.
We currently have 17 financial institutions on our Lender Solutions platform, with plans to expand in 2022. Rising rates have particularly cooled the refinance markets, and that's why our strength of purchase money loans is so important. This will help us in 2022 and beyond when refinance activity will likely continue to decline. C&F Finance will continue to diversify its business by generating stronger credit score loan, auto loan contracts, as well as growing the thriving boat and RV lending business in 2022 and beyond. We moved C&F Finance operations into a new state-of-the-art corporate headquarters near Richmond International Airport in 2021. Our long-term commitment to C&F Finance made building this new facility key to our strategic growth initiatives for the future.
Like the bank and mortgage company, C&F Wealth Management has long-term advisors who work closely with these partners to generate a total customer relationship. We have successfully integrated many of these advisors into our market locations, which results in a comprehensive one-stop financial experience for our customers. We plan to grow our wealth business this year by recruiting experienced advisors from the Charlottesville, Fredericksburg, and Southside Hampton Roads markets. At C&F Bank, the big strategic imperative was and still is loan growth. That's where our strategic priorities will focus in 2022 and the years to come. The good news is that we have a strong commercial team who's already off to what should be a great year for growth. I also believe there is good expansion opportunities to support this objective in markets such as Hampton Roads, Charlottesville, Fredericksburg, and Richmond.
Speaking of newer markets, I should mention that we're very pleased with the results from our Northern Neck market gained with the Peoples Community Bank merger. Deposits and account openings have increased, and the cost of our deposits has shifted more favorably to the low-cost core type I spoke to previously. The biggest win here is our solid expansion in the fast-growing Fredericksburg market, which is already producing substantial new loan and deposit growth. In addition to increasing loans in all markets, we will also focus on growing deposit share in markets where C&F is not yet a household name, such as Metro Richmond, Charlottesville, Fredericksburg, and the Tidewater Hampton Roads area. These markets are critical to the long-term net income growth of our company, given business and population growth metrics.
Improving operational efficiency in all of our subsidiaries by streamlining labor-intensive processes and eliminating unnecessary costs is a significant objective for 2022 and years to come. The rapid transition of customer preferences to digital channels accelerated by the pandemic is a big driver here. We're confident in our ability to generate strong savings and even a better customer experience as we implement our plans. Companies like ours must adopt a digital-first mentality when it comes to serving customers, and we have. Our goal is to ultimately transform our business model from one largely reliant on in-person customer visits and interaction supported by technology to one primarily driven by technology platforms and enhanced by traditional distribution channels and interactions. It's critical as competition, both from other banks and fintechs like Chime, Kabbage, and Venmo is increasing.
Even in this digital world, we're still only as good as the people behind these systems, and it's becoming much more difficult to attract and retain great talent. Competition for top talent is at an all-time high, so we must continue to invest in programs that make C&F a great place to work. The current job market offers so many new options, including staying at home and working remotely, further adding to the challenge. We are working hard to meet these new expectations while retaining the highly personal office environment that's been our advantage for years. I also believe that in order to attract and retain great talent, we must continue to foster a more diverse, equal, and inclusive workplace.
Fairness and opportunity for all has been central to our company's core values for 95 years, and we believe it's essential to our future as a viable competitor in the marketplace. It's clear that the world is changing, so our goal is to continually build awareness, learn, and develop ideas that will make us a stronger company. We have confidence in the steps that we've taken and feel confident that we are headed in the right direction. I'm not sure anyone is excited to forecast the next couple of years given the chaotic nature of the past two. Interest rates have started to increase, and experts are forecasting these increases will accelerate. Persistent inflation and the prospect of a potential downturn have now taken center stage in the US economy. These and other factors lead us to expect potential deterioration in the credit quality across the industry.
In addition, we are responding to increased scrutiny related to certain consumer protections and expect it to continue. The strong culture we have built of operational discipline to manage key risks such as credit, interest rates, liquidity, compliance, and capital sufficiency gives me confidence we'll meet the challenges that arise. Speaking of risk, cybersecurity is now clearly front and center with the high-profile attacks in 2021 to companies large and small, as well as governments and municipalities. Our company's core service providers and other tech vendors are more critical to our operations than ever before. Their significance has certainly grown and is why we must only partner with solid third parties that are addressing the latest cyber threats.
In summary, our 2021 performance once again demonstrates we remain well positioned to continue delivering excellent returns to all C&F stakeholders, our customers, employees, the communities we serve, and you, our shareholders. The company's solid balance sheet and income statement, driven once again by our beneficial diversification, is at the heart of these desired returns. We are thankful for everyone who choose to be part of our company, and we are very excited about the future, no matter what challenges it brings. On a note of history, I'm proud to say our company celebrated its 95th anniversary in January of this year. This milestone is an exceptional testament to the loyal employees, customers, shareholders, and members of communities we serve.
We are grateful to have had the opportunity to serve others for this many years and are committed to what it will take for us to continue serving others for many years to come. I'll close by sincerely thanking you once again for your loyal support. The trust and the confidence you give us is something we do not take for granted, no matter how long we have been around. We must earn this each and every day, and that is our intention. I wish you the very best for 2022, including physical and financial wellness. Yes, I very much look forward to seeing you next year in person. Thank you very much.
We will now begin our question and answer session. We will address questions that have been submitted prior to or during the meeting that are pertinent to shareholders generally. Questions.
There have been no questions.
There are no further questions. I declare the meeting adjourned. Thank you very much.