Northwest Bancshares, Inc. · NASDAQ:NWBI
Northwest Bancshares — Q3 2024 Earnings Presentation
18 slides from Northwest Bancshares's earnings presentation, Oct 29, 2024
Slide 1: Third Quarter 2024 Earnings Conference Call
Third Quarter 2024 Earnings Conference Call October 29, 2024 Louis J. Torchio T.K. Creal President and Chief Executive Officer Chief Credit Officer Douglas M. Schosser Joseph D. Canfield Chief Financial Officer Chief Accounting Officer
Slide 2: Forward-looking Statements and Additional Information
Forward-looking Statements and Additional Information The information contained in this presentation may contain forward-looking statements. When used or incorporated by reference in disclosure documents, the words “believe,” “anticipate,” “estimate,” “expect,” “project,” “target,” “goal” and simila
Slide 3: Northwest Bancshares At-A-Glance
Northwest Bancshares At-A-Glance For the quarter ended September 30, 2024 FINANCIAL CENTERS 130 FOUNDED 1896 TOTAL ASSETS TOTAL LOANS TOTAL DEPOSITS $14.4B $11.3B $12.1B ROA ROTCE Diluted EPS NIM 0.93% 11.3% (1) $0.26 3.33% (1) Non-GAAP measure- see slides 17-19 for reconciliation 3
Slide 4: 3Q 2024 Highlights
3Q 2024 Highlights: Balance Sheet Management results in Solid Performance • Loan growth muted with focus on re-mixing portfolio and profitable growth Balance Sheet • Average commercial loans increased 3% QoQ and 26% YoY • Average deposits flat QoQ and up 3% YoY • Improved 13 bps due to higher averag
Slide 5: Loan Balances
Loan Balances Summary Comments Change in Loan Mix 11,500 • Average loans decreased 1.3% QoQ ,portfolio mix continued to 11,400 11,369 become more commercial weighted 11,300 (56) (17) 49 11,224 • Company focused on profitable growth to drive margin 11,200 (92) expansion (29) $ millions 11,100 +3% • A
Slide 6: Deposit Balances
Deposit Balances Summary Comments 12,120 Change in Deposit Mix • Deposit balances remained strong as average total 12,100 12 12,097 deposits were stable QoQ and grew 3.2% versus 3Q23 12,086 9 12,080 8 • Customer (non-brokered) average deposits grew $120 million (16) (2) QoQ while brokered deposits d
Slide 7: Net Interest Margin
Net Interest Margin Summary Comments Net Interest Income (FTE) and NIM Trends • Net interest income increased 4% with NIM expanding to 3.33% 114.0 112.2 3.75 from 3.20% in the previous quarter, with 4bps of the increase due to 112.0 a non-accrual loan payoff in 3Q 110.0 109.3 3.55 107.1 107.7 $ mill
Slide 8: Earning Asset & Funding Mix
Earning Asset & Funding Mix Earning Asset Mix Funding Mix Ending balances Floating Periodic Ending balances 3Q24 Total % Fixed % 3Q24 Total % < 1 Year > 1 Year ($ Millions) % % ($ Millions) Securities 1,879 14% 96% 0% 4% Demand 2,582 21% 100% 0% Residential mortgage 3,249 25% 97% 2% 1% Interest-bear
Slide 9: Securities Portfolio
Securities Portfolio Summary Comments Securities Portfolio • Achieved previously announced securities portfolio restructure metrics Municipal 4% • Payback period of ~3 years from the restructure remain unchanged Treasury/Agency • Securities portfolio yield increased 10bps to 2.55% in the quarter 8%
Slide 10: Noninterest Income
Noninterest Income Summary Comments Noninterest Income Trend • Excluding 2Q24 $39.4 million loss on the sale of investment securities, 40.00 noninterest income decreased $2.7 million QoQ • Continued grow in Service charges and Trust income were offset by lower gain on sale of SBA loans and a MTM los
Slide 11: Noninterest Expense
Noninterest Expense Summary Comments Expense Mix and Efficiency Trend • Disciplined expense management led to a QoQ 1.8% decrease in expenses 3Q23 4Q23 1Q24 2Q24 3Q24 • Compensation and benefits growth vs 2Q24 attributed to additional temporary Efficiency Ratio 62.9% 66.9% 68.6% 94.3% 65.2% 120.0 20
Slide 12: Allowance for Credit Losses
Allowance for Credit Losses Summary Comments Total Loans and Allowance • Overall ALLL coverage remains strong, increasing to 1.11% 11,600 11,501 1.40% 11,500 11,415 • Net charge-offs of 18 bps increased vs 2Q24 that were lower due 11,354 1.30% 11,400 to recoveries in that quarter 11,310 11,305 $ mil
Slide 13: Credit Quality
Credit Quality Summary Comments 30 Day Loan Delinquency 93.3 • Disciplined underwriting focus has resulted in credit risk metrics 100.0 90.3 1.40% 79.0 remaining steady and below pre-pandemic as well as national levels 80.0 68.3 0.79% 0.76% 57.2 0.70% 0.90% • Non-performing assets improved due to pa
Slide 14: Commercial/CRE Loan Distribution
Commercial/CRE Loan Distribution Summary Comments Commercial Commitments By Industry • Diverse portfolio has allowed Northwest to avoid material industry issues; Immaterial large metro office or rent controlled multi- family concentrations • Health care sector is a focus, see detail on slide 16 Real
Slide 15: Commercial Real Estate Concentration
Commercial Real Estate Concentration Regulatory CRE Concentration 167% of T1+ACL • $362MM in exposure of which 22% is classified with no material delinquency Property Type 5 or More Unit Dwelling • Portfolio is well diversified geographically 14% - $105MM Ohio All Others - $85MM New York ~30 other p
Slide 16: 2024 Outlook
2024 Outlook $ in Millions 1Q24 2Q24 3Q24 4Q24 Guidance Profitability and credit discipline keeps growth in low single digits Average Loans 11,345 11,369 11,224 per quarter Average Deposits 11,888 12,086 12,097 Stable deposit balances expected through managed cost Net Interest Margin 3.10% 3.20% *3.
Slide 17: Non-GAAP Reconciliation
Non-GAAP Reconciliation *Dollars in thousands, except per share amounts 17
Slide 18: Non-GAAP Reconciliation – Continued
Non-GAAP Reconciliation – Continued *Dollars in thousands 18