First Northwest Bancorp · NASDAQ:FNWB
First Northwest Bancorp — Q2 2021 Earnings Presentation
31 slides from First Northwest Bancorp's earnings presentation, September 2021
Slide 1: Investor Presentation Second Quarter 2021
Investor Presentation Second Quarter 2021 September 2021 © 2021 FNWB 1
Slide 2: About First Northwest Bancorp (FNWB)
Bank holding company for First Fed, a growing $1.8 About First Northwest billion asset, community bank headquartered in Port Bancorp (FNWB) Angeles, Washington* First Fed is a Washington state-chartered savings bank, founded in 1923 FNWB Six Branches in Clallam and Jefferson Counties, two in K
Slide 3: First Fed Mission Statement
We design and deliver delightful, accessible, and effortless financial solutions by empowering our team members to improve the lives of those we serve. First Fed Mission Statement © 2021 FNWB 3
Slide 4: Market Expansion
Market Expansion Opened first King County branch on July 26, 2021 after the acquisition of the Bellevue, Washington branch of Sterling Bank and Trust of Southfield, Michigan, adding $65.4 million in deposit accounts. Executed lease to relocate Commercial and Mortgage Lending and Admin Center fro
Slide 5: Brand Refresh
Brand Refresh Primary Reasons for Our Name Change: 1. Familiar: Our customers and employees already call us “First Fed.” 2. Findable: Our website is ourfirstfed.com and social media is “ourfirstfed.” So, it is easier for people to find us online by searching “first fed.” 3. Differentiator: Our new n
Slide 6: Current Strategic Initiatives
Current Strategic Initiatives 1 2 3 4 Investment in Technology Launch of quin Marketplace Lending Fintech Partners Deposit Account Opening Joint Venture launched in Focus on leveraging our Primary focus is on (Terafina) early 2021 charter, credit and payments levering our compliance capabili
Slide 7: Fintech Joint Venture
Fintech Joint Venture Quin Ventures is a joint venture partnership Vision: Empowering dreams through between FNWB and Peace of Mind, Inc. – a combined effort by a community bank and a financial peace of mind. financial technology company Lifestyle Protection during times of stress The purpose
Slide 8: Substantial Growth While Enhancing Asset Mix
Substantial Growth While Enhancing Asset Mix Q2 2019 Q2 2020 Q2 2021 Total Assets: Total Assets: Total Assets: $1,258M $1,479M $1,787M © 2021 FNWB Source: Company documents; Financial data as of June 30, 2021 8
Slide 9: Securities Portfolio
Securities Portfolio Investment Portfolio Characteristics as of June 30, 2021 Book Value: $363.7 Million Corp ABS Corp Debt 1% 14% Market Value $370.4 Million MBS Effective Duration: 5.64 years US Govt ABS 35% 10% Average Life: 6.59 years SBA Municipal Securities – Portfolio Ratings: 5%
Slide 10: Building Revenue
Non-interest Net Interest Income Building Revenue Income 12.8% 87.2% Total Operating Q2 2019 Revenue: $16,000 $2,000 2019Q2 2019Q2 $1,829 $11.1M 2020Q2 2020Q2 2021Q2 $13,649 $1,800 $14,000 2021Q2 $1,600 Non-interest $12,000 Net Interest Income $1,400 Income 28.9% $10,113 71.1% $10,000 $9,676 $1,200
Slide 11: 2Q21 Financial Highlights
Deposits increased nominally during the quarter and 2Q21 Financial Highlights increased 23.2% from one year prior, to $1.44 billion at June 30, 2021, due to successful organic and wholesale deposit-gathering strategies, including significant Second quarter net income was $3.0 million, compared g
Slide 12: Measurable Improved Profitability
Measurable Improved Profitability Trailing Twelve Month Net Income ($000) Trailing Twelve Month ROAA (%) Trailing Twelve Month Efficiency Ratio (%) Trailing Twelve Month Net Interest Margin (%) © 2021 FNWB Source: S&P Global Market Intelligence; Financial data as of June 30, 2021 12
Slide 13: Net Interest Income and Margin
Net Interest Income and Margin $14,500 3.60% $13,500 3.50% $12,500 3.48% 3.46% 3.40% $11,500 3.36% 3.34% 3.30% $10,500 3.20% $9,500 3.16% 3.17% 3.14% 3.10% $8,500 3.11% 3.10% 3.10% $7,500 3.00% $6,500 2.90% 1Q 2019 2Q 2019 3Q 2019 4Q 2019 1Q 2020 2Q 2020 3Q 2020 4Q 2020 1Q 2021 2Q 2021 $ in thousand
Slide 14: Balance Sheet Growth
Actual (Ex. PPP) Balance Sheet Growth PPP Loans Total Assets ($M) Total Loans and Leases (%) CAGR¹: CAGR¹: 12.1% 15.0% Total Deposits ($M) Total Equity ($M) Loan / Deposit (%) CAGR¹: 14.8% © 2021 FNWB 1) CAGR calculated from 2016Y to 2021Y 14 Source: Company documents; Financial data as of June 30,
Slide 15: Leading Deposit Market Share
Leading Deposit Market Share Clallam County, WA Whatcom County, WA Market Market # Deposits Share # Deposits Share Rank Institution (ST) Branches ($M) (%) Rank Institution (ST) Branches ($M) (%) 1 First Northwest Bancorp (WA) 7 1,012 38.7 1 Peoples Bancorp (WA) 9 1,352 24.3 2 Sound Financial Bancorp
Slide 16: Strong Core Deposit Composition
Strong Core Deposit Composition (Dollars in Thousands) 6/30/2021 Deposits Type Balance % Total MMDA & Savings $696,849 48.3% Brokered CDs Non-Int. Checking $307,119 21.3% 5% Retail CDs $187,837 13.0% Non-Int Retail CDs Interest Checking $175,939 12.2% Checking 13% Brokered CDs $73,994 5.1% 21% Total
Slide 17: Loan Portfolio Composition
Loan Portfolio Composition (Dollars in Thousands) 6/30/2021 Loan Type Balance % Total C&I…PPP 4% Other Consumer 1-4 Family $338,702 26.9% Auto 9% 4% Commercial Real Estate $319,644 25.3% Multi-Family $166,502 13.2% 1-4 Family C&D $183,685 14.6% 27% Auto $117,764 9.3% C&D 15% C&I $30,395 2.4% PPP $45
Slide 18: Historically Strong Asset Quality
Historically Strong Asset Quality NPAs / Assets (%) Loan Loss Reserve / Total Loans (%) Texas Ratio 2021Q2: 0.88% ALLL/Total Loans (Ex. PPP) 2021Q2: 1.21% NCOs / Avg. Loans (%) Growth focused on low-risk asset classes such as Multi-Family Use of enhanced underwriting throughout the COVID-19 pand
Slide 19: Returning Capital to Shareholders
Returning Capital to Shareholders Status of Share Repurchase Program On October 28, 2020, the Company announced that its Board of Directors had authorized the repurchase and retirement of up to an additional ~1 million shares of its common stock, or 10% of the outstanding shares at that time As
Slide 20: Bank Level Capital Ratios
Bank Level Capital Ratios TCE / TA (%) Leverage Ratio (%) Tier 1 Capital Ratio (%) Total RBC Ratio (%) © 2021 FNWB Source: Company documents; Financial data as of June 30, 2021 20
Slide 21: Capital Metrics
Capital Metrics Tangible Book Value Per Share Tangible Common Equity Ratio $19.00 $18.49 $18.50 $18.20 13.0% $18.00 $17.86 $17.48 12.0% $17.50 11.9% $17.07 12.0% 11.6% $17.00 11.3% $16.50 11.0% $16.02 10.5% 10.6% $16.00 $15.50 10.0% $15.00 $14.50 9.0% 1Q 2020 2Q 2020 3Q 2020 4Q 2020 Q1 2021 Q2 2021
Slide 22: Consolidated Historical Balance Sheet
For the Quarter Ending 2020Q2 2020Q3 2020Q4 2021Q1 2021Q2 Consolidated Assets ($000) Total Cash and Cash Equivalents Available for Sale Securities 49,588 364,273 52,079 369,111 65,155 364,296 99,271 393,495 80,722 370,500 Historical Other Securities Total Cash & Securities 6,074 419,935 5,944 427,13
Slide 23: Consolidated Historical Income Statement
Consolidated Historical Income Statement For the Quarters Ending, 2020Q2 2020Q3 2020Q4 2021Q1 2021Q2 Net Interest Income 10,113 11,761 12,677 13,483 13,649 Provision for Loan Losses 1,500 1,350 930 500 300 Loan and Deposit Fees 765 868 940 837 1,001 Mortgage Servicing Fees, Net (172) 148 146 30 13 N
Slide 24: Experienced Leadership Team
Experienced Leadership Team Years of Industry Name Title Years with the Company Experience President, Chief Executive Officer and Matthew P. Deines 2 20+ Director Geri Bullard Executive VP, Chief Financial Officer 1.5 25+ Kelly Liske Executive VP, Chief Banking Officer 15 20+ Executive VP, Chief Hum
Slide 25: Leadership Team Bios
Leadership Team Bios Matt Deines (age 47) Terry Anderson (age 52) Derek Brown (age 50) Geri Bullard (age 56) President and CEO EVP | Chief Credit Officer EVP | Chief HR & Marketing Officer EVP | Chief Financial Officer President and CEO of the Bank since Chief Credit Officer since 2018. Formerly Chi
Slide 26: Leadership Team Bios
Leadership Team Bios Kelly Liske (age 45) Chris Riffle (age 46) Randy Riffle (age 45) EVP | Chief Banking Officer EVP | Chief Operating Officer | EVP | Chief Lending Officer General Counsel Chief Banking Officer since 2013. Chief Lending Officer since 2020. Over 20 years of banking experience, Gener
Slide 27: Board Comprised of Community Leaders with Diverse Backgrounds
Board Comprised of Community Leaders with Diverse Backgrounds Name Title Tenure with the Company Chair of the Board/ Retired - Owner S.E. Stephen E. Oliver 20 years Oliver, Inc. Vice Chair of the Board/ Retired Cindy H. Finnie 9 years Executive from Allstate Insurance Sherilyn G. Anderson* Director
Slide 28: Overview of Risk Management
Overview of Risk Management Risk Management Governance Technology and Cybersecurity Board and Committee Oversight and Reporting at least Core Processing Environment: Fiserv Cleartouch quarterly Innovative Partners for Digital Account Acquisition and Tenured General Counsel oversees Governanc
Slide 29: ESG – Creating Value Beyond Banking
ESG – Creating Value Beyond Banking Governance Initiatives Appointed our third female director in 2020. Native American Board Member to join in September 2021 Formalized Diversity, Equity and Inclusion (DEI) Policy to increase diversity and social responsibility companywide Formalized Environm
Slide 30: Market Footprint
Market Footprint 15 locations: 8 in Clallam and Jefferson Counties* 2 in Kitsap County 2 in King County 3 in Whatcom County *Including ITM’s © 2021 FNWB 30
Slide 31: Thank You!
Thank You! Contact Matt Deines Geri Bullard President and CEO EVP | CFO matt.deines@ourfirstfed.com geri.bullard@ourfirstfed.com © 2021 FNWB 31
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