First Northwest Bancorp · NASDAQ:FNWB

First Northwest Bancorp — Q3 2024 Earnings Presentation

28 slides from First Northwest Bancorp's earnings presentation, October 2024

  1. Slide 1: Investor Presentation Third Quarter 2024

    Investor Presentation Third Quarter 2024 October 2024 © 2024 FNWB 1

  2. Slide 2: Forward-looking statements

    Certain matters discussed in this investor presentation may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to, among other things, expectations of the transactions discussed, business environment

  3. Slide 3: About First Northwest Bancorp (FNWB)

     Bank holding company for First Fed, a growing About First Northwest community bank with $2.2 billion* in assets Bancorp (FNWB)  First Fed is a Washington state-chartered commercial bank, headquartered in Port Angeles where it was founded in 1923 FNWB  12 branches: 6 in Clallam and Jefferson Coun

  4. Slide 4: First Fed Executive Team

    First Fed Executive Team Matt Deines Geri Bullard David Edelstein President and CEO Chief Financial Officer & Chief Innovation Officer Chief Operating Officer Kyle Henderson Chris Neros Chris Riffle Chief Credit Officer Chief Banking Officer Chief Strategy Officer & General Counsel © 2024 FNWB 4

  5. Slide 5: Year to date Significant Items

    Year to date Significant Items  The Bank’s consent order with the FDIC pertaining to compliance matters related to its partnership with Quin Ventures was terminated in the third quarter.  First Fed Bank balance sheet restructuring, which includes the sale-leaseback, sale of lower-yielding investme

  6. Slide 6: Consent Order Lifted

    Consent Order Lifted  On November 21, 2023 the Bank entered into a Consent Order with the FDIC related to consumer compliance matters.  The matters identified in the order primarily pertained to the activities of our former fintech partner, Quin.  Management and the Board had taken steps to wind

  7. Slide 7: Classified Asset Breakdown

    Classified Asset Breakdown 9/30/2024 6/30/2024 3/31/2024 12/31/2023 Classified Assets Condo Project 11,187,088 11,187,088 14,437,175 14,980,895 Townhome Project 8,177,412 8,098,809 - - Individual Equipment Loans 5,853,018 262,643 1,080,325 - Commercial Real Estate Loans 6,228,187 9,133,578 9,267,526

  8. Slide 8: Breakdown of Provisions for ACL and Net Charge-offs

    Breakdown of Provisions for ACL and Net Charge-offs Provision for Loan Losses 9/30/2024 6/30/2024 3/31/2024 12/31/2023 Charge-offs 9/30/2024 6/30/2024 3/31/2024 12/31/2023 Condo Project - 3,978,279 - - Condo Project - 3,978,279 - - Townhome Project - - - - Townhome Project - - - - Individual Equipme

  9. Slide 9: Strategic Focus

    Strategic Focus Small Business Relationship Anticipating potential Building Core Deposits and Targeted growth in Home Banking focusing on C&I, increases to 1-4 Mortgage reducing reliance on Equity lending with LTVs Owner Occupied CRE, SBA, saleable productions Brokered and FHLB Funding less than 80%

  10. Slide 10: Execution of Balance Sheet Restructure

    Execution of Balance Sheet Restructure The bank took a measured Restructure of approach over the past four Bond Sales (Q4 Branch Sale Lease Bank Owned Life 2023 and Q2 2024) Back in Q2 2024 quarters to improve net Insurance interest income and reduce balance sheet sensitivity Two Fixed to Floating P

  11. Slide 11: Net Interest Income and Margin

    Net Interest Income and Margin ($ in Thousands) 4.50% $22,000 3.96% 3.88% 4.00% $19,500 $18,931 3.46% $18,205 3.50% 3.25% $17,000 $16,305 2.97% $15,982 2.84% 3.00% 2.76% 2.76% 2.71% $14,950 $14,500 $14,195 $14,234 $14,020 $13,929 2.50% $12,000 2.00% Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1

  12. Slide 12: Capital Management

    Capital Management Status of Share Repurchase Program Shares Repurchased  The Company has bought back a total of 3,985,342 shares since 2016.  In April 2024, the Company announced that its Board of Directors has authorized the repurchase of 10% , or 944,279, of authorized and outstanding shares. A

  13. Slide 13: Performance Metrics

    Performance Metrics Trailing Twelve Months Net Income (Loss) ($ in Thousands) Trailing Twelve Months ROAA (%) Trailing Twelve Months Efficiency Ratio (%) Trailing Twelve Months Net Interest Margin (%) © 2024 FNWB Source: S&P Global Market Intelligence, Company documents; Financial data as of Septemb

  14. Slide 14: Performance Metrics

    Performance Metrics Trailing Twelve Month Return on Avg. Equity Trailing Twelve Month Earnings per Share Trailing Twelve Month Historical Book Value per Share Trailing Twelve Month Historical CE and TCE Ratios * * Non-GAAP reconciliation provided on page 26 © 2024 FNWB Source: S&P Global Market Inte

  15. Slide 15: Balance Sheet Growth

    Balance Sheet Growth ($ in Millions) Total Assets Total Loans and Leases Total Deposits Total Equity © 2024 FNWB 1CAGR calculated from first period to last period shown in chart 15

  16. Slide 16: Liquidity Overview

    Liquidity Overview Liquidity as of September 30, 2024 ($ in thousands) Sequential Total Off-Balance Sheet Liquidity Available Quarter Gross Net Three Months Ended Change Availability Utilization Availability ($ in thousands) 9/30/2024 6/30/2024 Q3 2024 FHLB Lines $576,876 $350,772 $226,105 Brokered

  17. Slide 17: Securities Portfolio

    Securities Portfolio Investment Portfolio Characteristics as of September 30, 2024  Book Value: $341.0 Million  Market Value: $310.9 Million  Effective Duration: 3.9 years; 4.9 years as of Q3 2023  Average Life: 7.4 years; 7.7 years as of Q3 2023 4.90%  Portfolio Yield: 4.90%, 4.18% as of Q3 20

  18. Slide 18: Loan Portfolio Composition

    Loan Portfolio Composition Loans by Type 9/30/2024 Change from ($ in Thousands) Balance % of Total 9/30/2023 9/30/2023 Commercial Real Estate $376,878 21.7% ($5,779) $382,658 1-4 Family 396,171 22.8% 25,937 370,234 Construction and Land Development 96,149 5.5% (47,762) 143,911 Multi-Family 354,842 2

  19. Slide 19: Core Deposit Composition

    Core Deposit Composition Deposits by Type 9/30/2024 Change from ($ in Thousands) Balance % of Total one year ago Noninterest Checking $252,999 14.8% ($16,802) Interest Checking 167,202 9.8% (15,158) Savings 212,763 12.4% (40,419) Money Market 433,308 25.3% 60,601 Q3 2024 Certificate of Deposit Broke

  20. Slide 20: Diversified Deposit Base

    Diversified Deposit Base September 30, 2024 Average consumer account balance $24 thousand Average business account balance $51 thousand Average customer account balance 1 $28 thousand Insured Cash Sweep ("ICS") deposits $67.5 million Uninsured deposits as a % of total deposits 23% 1 - Excludes publi

  21. Slide 21: Bank Level Capital Ratios

    Bank Level Capital Ratios Equity/Total Assets, Tangible CE/Tangible Assets * Leverage Ratio (as reported on FFIEC Form 051) * Non-GAAP reconciliation provided on page 26 Tier 1 Capital Ratio (as reported on FFIEC Form 051) Total RBC Ratio (as reported on FFIEC Form 051) © 2024 FNWB 21

  22. Slide 22: Consolidated Historical Balance Sheet

    For the Quarter Ending 2023Q3 2023Q4 2024Q1 2024Q2 2024Q3 Assets ($000) Consolidated Cash and Cash Equivalents Investments Federal Home Loan Bank (FHLB) Stock, at Cost 83,886 309,324 12,621 123,169 295,623 13,664 77,346 325,956 15,876 83,180 306,714 13,086 82,722 310,860 14,435 Total Cash & Securiti

  23. Slide 23: Consolidated Historical Income Statement

    For the Quarter Ending 2023Q3 2023Q4 2024Q1 2024Q2 2024Q3 Consolidated Income ($000) Interest and Fees on Loans Receivable 21,728 22,083 22,767 23,733 23,536 Interest on Investment Securities 3,368 3,392 3,633 3,948 3,787 Historical Other Interest Income Interest Income 738 25,834 833 26,309 927 27,

  24. Slide 24: Market Footprint

    Market Footprint 18 locations in 6 counties:  7 in Clallam: Headquarters with ITM, 5 branches, 1 business center with ITM  1 Jefferson branch  2 Kitsap branches  3 in King: 1 branch, 2 business centers  1 Snohomish business center  4 in Whatcom: 3 branches, 1 business center © 2024 FNWB 24

  25. Slide 25: Leading Deposit Market Share

    Leading Deposit Market Share Clallam County, WA Whatcom County, WA Rank Institution (ST) # Branches Deposits ($M) Market Share (%) Rank Institution (ST) # Branches Deposits ($M) Market Share (%) 1 First Northwest Bancorp (WA) 8 1,196 42.0 1 Peoples Bancorp (WA) 9 1,238 24.4 2 Sound Financial Bancorp

  26. Slide 26: Non-GAAP Reconciliations

    Non-GAAP Reconciliations This presentation contains financial measures that are not in conformity with generally accepted accounting principles in the United States of America ("GAAP"). Non-GAAP measures are presented where management believes the information will help investors understand the Compa

  27. Slide 27: To improve the lives of those we serve.

    To improve the lives of those we serve. Mission Statement © 2024 FNWB 27

  28. Slide 28: Thank You!

    Thank You! Contact Matt Deines Geri Bullard President and CEO EVP | CFO and COO matt.deines@ourfirstfed.com geri.bullard@ourfirstfed.com © 2024 FNWB 28

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