COLUMBUS, Ohio, Jan. 24, 2022 /PRNewswire/ -- Northwest Bancshares, Inc., (the "Company"), (NasdaqGS: NWBI) announced net income for the quarter ended December 31, 2021 of $30.1 million, or $0.24 per diluted share. This represents a decrease of $5.0 million, or 14.3%, compared to the same quarter last year when net income was $35.1 million, or $0.28 per diluted share. The annualized returns on average shareholders' equity and average assets for the quarter ended December 31, 2021 were 7.65% and 0.82% compared to 9.00% and 1.01% for the same quarter last year.
The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.20 per share payable on February 14, 2022 to shareholders of record as of February 3, 2022. This is the 109th consecutive quarter in which the Company has paid a cash dividend. Based on the market value of the Company's common stock as of December 31, 2021, this represents an annualized dividend yield of approximately 5.6%.
Ronald J. Seiffert, Chairman, President and CEO, added, "Earnings were enhanced this year due to the release of credit loss reserves throughout 2021 including this quarter. These reserves had been previously built up as a result of the uncertainties created by COVID-19. We are also very pleased that non-performing and classified assets as well as our delinquencies continued to trend downward in 2021 and that our expenses remained well-contained heading into 2022. Although yields stabilized in 2021, our net interest spread and net interest margin both declined due to our current excess liquidity position."
Mr. Seiffert continued, "Our overall in-branch transaction volumes once again declined in 2021 as our customers continued to migrate towards our digital banking experience. As a result, we have decided to further optimize our branch network by consolidating 12% of our branch offices in April of 2022. This effort, coupled with other efficiency measures, generated $2.8 million in severance and restructuring costs in the fourth quarter with an additional $3.5 million expected to be recognized in the first quarter of 2022. This overall initiative is anticipated to generate approximately $8.0 million in annual operating expense savings beginning in the second quarter of 2022."
Net interest income decreased by $6.2 million, or 6.1%, to $96.7 million for the quarter ended December 31, 2021, from $102.9 million for the quarter ended December 31, 2020, due to a $10.4 million, or 9.8%, decrease in interest income on loans receivable. The decrease in interest income on loans was due to a decrease of $616.7 million, or 5.8%, in the average balance of loans in addition to a reduction in the yield on loans to 3.79% for the quarter ended December 31, 2021 from 3.97% for the same quarter last year. Partially offsetting this decrease was a decrease in interest expense on deposits of $2.4 million, or 36.0%, primarily due to a decrease in our cost of interest-bearing liabilities to 0.26% for the quarter ended December 31, 2021 from 0.38% for the quarter ended December 31, 2020 as market interest rates continued to decline over the past year. Partially offsetting the decline in deposit interest rates was growth in the average balance of interest-bearing liabilities of $266.9 million, or 2.9%. The net impact of these changes caused the Company's net interest margin to decrease to 2.89% for the quarter ended December 31, 2021 from 3.26% for the same quarter last year.
The provision for credit losses experienced a net credit of $1.9 million for the quarter ended December 31, 2021, compared to a credit of $2.2 million for the quarter ended December 31, 2020. This credit to provision expense was primarily the result of improvements in the economic forecasts and our overall improvement in credit quality. Total classified loans decreased by $126.2 million, or 25.8%, to $363.2 million for the quarter ended December 31, 2021 from $489.3 million for the quarter ended December 31, 2020.
Noninterest income decreased by $5.1 million, or 15.8%, to $27.0 million for the quarter ended December 31, 2021 from $32.1 million for the quarter ended December 31, 2020. This decrease was primarily due to the decrease in mortgage banking income of $5.0 million, or 70.2%, to $2.1 million for the quarter ended December 31, 2021 from $7.1 million for the quarter ended December 31, 2020. This decrease in mortgage banking income reflects the continued impact of less favorable pricing in the secondary market. In addition, there was a decrease in insurance commission income of $2.0 million, or 100.0%. Partially offsetting these decreases was an increase in trust and brokerage income as growth in both customer accounts and market gains contributed to a $1.1 million, or 19.2%, increase over the prior year.
Noninterest expense decreased $6.6 million, or 7.1%, to $86.3 million for the quarter ended December 31, 2021, from $92.8 million for the quarter ended December 31, 2020. This decrease primarily resulted from a $4.4 million, or 61.1%, decrease in merger, asset disposition and restructuring expense to $2.8 million for the quarter ended December 31, 2021 from $7.2 million for the quarter ended December 31, 2020 due to both periods incurring expenses as part of branch optimization initiatives. In addition, other expenses decreased $2.4 million, or 63.9%, to $1.3 million for the quarter ended December 31, 2021 from $3.7 million for the quarter ended December 31, 2020 primarily due to a reduction in the unfunded loan loss reserve associated with improving credit trends for construction loans and undrawn lines of credit in the current year. Slightly offsetting this decrease was an increase in processing expenses of $1.5 million, or 11.9%, to $13.6 million for the quarter ended December 31, 2021 from $12.2 million for the quarter ended December 31, 2020 as we continue to invest in technology and infrastructure and as activity driven utilization fees for online and mobile banking and loan origination platforms have increased.
Net income for the year ended December 31, 2021 was $154.3 million, or $1.21 per diluted share. This represents an increase of $79.5 million, or 106.2%, compared to the year ended December 31, 2020, when net income was $74.9 million, or $0.62 per diluted share. The annualized returns on average shareholders' equity and average assets for the year ended December 31, 2021 were 9.91% and 1.08% compared to 4.72% and 0.58% for the prior year. This increase in net income was the result of a decrease in provision for credit losses of $95.9 million primarily as a result of releasing reserves built up in the prior year due to the uncertainties around the impact of COVID-19. In addition, there was a $10.6 million, or 8.0%, increase in non-interest income largely due to the $25.3 million gain recognized on the sale of the insurance business in the second quarter of 2021, partially offset by a $15.5 million decrease in mortgage banking income which, as previously noted, is due to the impact of less favorable pricing in the secondary market. In addition, noninterest expense decreased $2.6 million, or 0.7%, primarily driven by acquisition and branch optimization costs in the prior year which were partially offset by MutualBank related increases in compensation as well as increased cost associated with our digital strategy rollout.
Headquartered in Columbus, Ohio, Northwest Bancshares, Inc. is the bank holding company of Northwest Bank. Founded in 1896 and headquartered in Warren, Pennsylvania, Northwest Bank is a full-service financial institution offering a complete line of business and personal banking products, employee benefits and wealth management services. As of December 31, 2021, Northwest operates 162 full-service community banking offices and eight free standing drive-through facilities in Pennsylvania, New York, Ohio and Indiana. Northwest Bancshares, Inc.'s common stock is listed on the NASDAQ Global Select Market ("NWBI"). Additional information regarding Northwest Bancshares, Inc. and Northwest Bank can be accessed on-line at www.northwest.com.
Forward-Looking Statements - This release may contain forward-looking statements with respect to the financial condition and results of operations of Northwest Bancshares, Inc. including, without limitations, statements relating to the earnings outlook of the Company. These forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements, include among others, the following possibilities: (1) changes in the interest rate environment; (2) competitive pressure among financial services companies; (3) general economic conditions including an increase in non-performing loans; (4) changes in legislation or regulatory requirements; (5) difficulties in continuing to improve operating efficiencies; (6) difficulties in the integration of acquired businesses or the ability to complete sales transactions; and (7) increased risk associated with commercial real-estate and business loans. Management has no obligation to revise or update these forward-looking statements to reflect events or circumstances that arise after the date of this release.
Northwest Bancshares, Inc. and Subsidiaries | |||||
Consolidated Statements of Financial Condition (Unaudited) | |||||
(dollars in thousands, except per share amounts) | |||||
December 31,2021 | September 30,2021 | December 31,2020 | |||
Assets | |||||
Cash and cash equivalents | $ 1,279,259 | 1,090,485 | 736,277 | ||
Marketable securities available-for-sale (amortized cost of $1,565,002, $1,587,105 and $1,375,685, respectively) | 1,548,592 | 1,583,715 | 1,398,941 | ||
Marketable securities held-to-maturity (fair value of $751,513, $609,777 and $179,666, respectively) | 768,154 | 618,395 | 178,887 | ||
Total cash and cash equivalents and marketable securities | 3,596,005 | 3,292,595 | 2,314,105 | ||
Residential mortgage loans held-for-sale | 25,056 | 27,411 | 58,786 | ||
Residential mortgage loans | 2,969,564 | 2,962,110 | 3,009,335 | ||
Home equity loans | 1,319,931 | 1,350,348 | 1,467,736 | ||
Consumer loans | 1,838,748 | 1,816,836 | 1,507,993 | ||
Commercial real estate loans | 3,015,484 | 3,162,551 | 3,345,889 | ||
Commercial loans | 847,609 | 879,712 | 1,191,110 | ||
Total loans receivable | 10,016,392 | 10,198,968 | 10,580,849 | ||
Allowance for credit losses | (102,241) | (109,767) | (134,427) | ||
Loans receivable, net | 9,914,151 | 10,089,201 | 10,446,422 | ||
FHLB stock, at cost | 14,184 | 14,567 | 21,748 | ||
Accrued interest receivable | 25,599 | 26,995 | 35,554 | ||
Real estate owned, net | 873 | 809 | 2,232 | ||
Premises and equipment, net | 156,524 | 155,740 | 161,538 | ||
Bank-owned life insurance | 256,213 | 254,871 | 253,951 | ||
Goodwill | 380,997 | 380,997 | 382,279 | ||
Other intangible assets, net | 12,836 | 14,041 | 19,936 | ||
Other assets | 144,126 | 159,419 | 168,503 | ||
Total assets | $ 14,501,508 | 14,389,235 | 13,806,268 | ||
Liabilities and shareholders' equity | |||||
Liabilities | |||||
Noninterest-bearing demand deposits | $ 3,099,526 | 3,052,115 | 2,716,224 | ||
Interest-bearing demand deposits | 2,940,442 | 2,926,351 | 2,755,950 | ||
Money market deposit accounts | 2,629,882 | 2,584,424 | 2,437,539 | ||
Savings deposits | 2,303,760 | 2,271,496 | 2,047,424 | ||
Time deposits | 1,327,555 | 1,387,827 | 1,642,096 | ||
Total deposits | 12,301,165 | 12,222,213 | 11,599,233 | ||
Borrowed funds | 139,093 | 126,496 | 159,715 | ||
Subordinated debt | 123,575 | 123,486 | 123,329 | ||
Junior subordinated debentures | 129,054 | 128,989 | 128,794 | ||
Advances by borrowers for taxes and insurance | 44,582 | 26,951 | 45,230 | ||
Accrued interest payable | 1,804 | 589 | 2,054 | ||
Other liabilities | 178,664 | 198,743 | 209,210 | ||
Total liabilities | 12,917,937 | 12,827,467 | 12,267,565 | ||
Shareholders' equity | |||||
Preferred stock, $0.01 par value: 50,000,000 shares authorized, no shares issued | — | — | — | ||
Common stock, $0.01 par value: 500,000,000 shares authorized, 126,612,183, 126,521,344, and 127,019,452 shares issued and outstanding, respectively | 1,266 | 1,265 | 1,270 | ||
Additional paid-in capital | 1,010,405 | 1,008,099 | 1,015,502 | ||
Retained earnings | 609,529 | 604,787 | 555,480 | ||
Accumulated other comprehensive loss | (37,629) | (52,383) | (33,549) | ||
Total shareholders' equity | 1,583,571 | 1,561,768 | 1,538,703 | ||
Total liabilities and shareholders' equity | $ 14,501,508 | 14,389,235 | 13,806,268 | ||
Equity to assets | 10.92 % | 10.85 % | 11.14 % | ||
Tangible common equity to assets* | 8.43 % | 8.34 % | 8.48 % | ||
Book value per share | $ 12.51 | 12.34 | 12.11 | ||
Tangible book value per share* | $ 9.40 | 9.22 | 8.95 | ||
Closing market price per share | $ 14.16 | 13.28 | 12.74 | ||
Full time equivalent employees | 2,332 | 2,404 | 2,421 | ||
Number of banking offices | 170 | 170 | 170 | ||
* | Excludes goodwill and other intangible assets (non-GAAP). |
Northwest Bancshares, Inc. and Subsidiaries | |||||||||
Consolidated Statements of Income (Unaudited) | |||||||||
(dollars in thousands, except per share amounts) | |||||||||
Quarter ended | |||||||||
December 31, 2021 | September 30, 2021 | June 30,2021 | March 31, 2021 | December 31, 2020 | |||||
Interest income: | |||||||||
Loans receivable | $ 95,295 | 97,475 | 95,255 | 102,318 | 105,681 | ||||
Mortgage-backed securities | 5,743 | 5,840 | 5,680 | 4,200 | 4,551 | ||||
Taxable investment securities | 640 | 649 | 693 | 634 | 471 | ||||
Tax-free investment securities | 688 | 628 | 594 | 575 | 656 | ||||
FHLB stock dividends | 82 | 71 | 138 | 116 | 192 | ||||
Interest-earning deposits | 467 | 352 | 192 | 183 | 178 | ||||
Total interest income | 102,915 | 105,015 | 102,552 | 108,026 | 111,729 | ||||
Interest expense: | |||||||||
Deposits | 4,295 | 4,540 | 4,773 | 5,514 | 6,714 | ||||
Borrowed funds | 1,964 | 2,056 | 2,050 | 2,054 | 2,127 | ||||
Total interest expense | 6,259 | 6,596 | 6,823 | 7,568 | 8,841 | ||||
Net interest income | 96,656 | 98,419 | 95,729 | 100,458 | 102,888 | ||||
Provision for credit losses | (1,909) | (4,354) | — | (5,620) | (2,230) | ||||
Net interest income after provision for credit losses | 98,565 | 102,773 | 95,729 | 106,078 | 105,118 | ||||
Noninterest income: | |||||||||
Gain/(loss) on sale of investments | (4) | (46) | (105) | (21) | 75 | ||||
Service charges and fees | 13,500 | 13,199 | 12,744 | 12,394 | 13,074 | ||||
Trust and other financial services income | 6,820 | 7,182 | 7,435 | 6,484 | 5,722 | ||||
Insurance commission income | — | 44 | 1,043 | 2,546 | 2,034 | ||||
Gain/(loss) on real estate owned, net | 71 | 247 | 166 | (42) | 114 | ||||
Income from bank-owned life insurance | 1,343 | 1,332 | 1,639 | 1,736 | 1,330 | ||||
Mortgage banking income | 2,120 | 3,941 | 3,811 | 6,020 | 7,120 | ||||
Gain on sale of insurance business | — | — | 25,327 | — | — | ||||
Other operating income | 3,192 | 3,287 | 2,648 | 2,836 | 2,654 | ||||
Total noninterest income | 27,042 | 29,186 | 54,708 | 31,953 | 32,123 | ||||
Noninterest expense: | |||||||||
Compensation and employee benefits | 48,691 | 49,063 | 48,894 | 47,239 | 48,209 | ||||
Premises and occupancy costs | 7,104 | 7,745 | 7,410 | 8,814 | 7,614 | ||||
Office operations | 3,144 | 4,143 | 3,317 | 3,165 | 4,009 | ||||
Collections expense | 602 | 411 | 303 | 616 | 893 | ||||
Processing expenses | 13,639 | 13,517 | 15,151 | 13,456 | 12,186 | ||||
Marketing expenses | 2,054 | 2,102 | 2,101 | 1,980 | 1,994 | ||||
Federal deposit insurance premiums | 1,131 | 1,184 | 1,353 | 1,307 | 1,651 | ||||
Professional services | 4,513 | 4,295 | 4,231 | 4,582 | 3,599 | ||||
Amortization of intangible assets | 1,205 | 1,321 | 1,433 | 1,594 | 1,664 | ||||
Real estate owned expense | 44 | 94 | 85 | 75 | 64 | ||||
Merger, asset disposition and restructuring expense | 2,812 | — | 632 | 9 | 7,238 | ||||
Other expenses | 1,346 | 2,227 | 1,422 | 3,354 | 3,728 | ||||
Total noninterest expense | 86,285 | 86,102 | 86,332 | 86,191 | 92,849 | ||||
Income before income taxes | 39,322 | 45,857 | 64,105 | 51,840 | 44,392 | ||||
Income tax expense | 9,266 | 10,794 | 15,138 | 11,603 | 9,327 | ||||
Net income | $ 30,056 | 35,063 | 48,967 | 40,237 | 35,065 | ||||
Basic earnings per share | $ 0.24 | 0.28 | 0.38 | 0.32 | 0.28 | ||||
Diluted earnings per share | $ 0.24 | 0.27 | 0.38 | 0.32 | 0.28 | ||||
Annualized return on average equity | 7.65 % | 8.86 % | 12.58 % | 10.61 % | 9.00 % | ||||
Annualized return on average assets | 0.82 % | 0.97 % | 1.37 % | 1.17 % | 1.01 % | ||||
Annualized return on tangible common equity * | 10.02 % | 11.92 % | 16.66 % | 14.31 % | 12.27 % | ||||
Efficiency ratio ** | 66.51 % | 66.44 % | 67.35 % | 63.88 % | 62.18 % | ||||
Annualized noninterest expense to average assets *** | 2.25 % | 2.33 % | 2.35 % | 2.45 % | 2.42 % | ||||
* | Excludes goodwill and other intangible assets (non-GAAP). |
** | Excludes gain on sale of insurance business, amortization of intangible assets and merger, asset disposition and restructuring expenses (non-GAAP). |
*** | Excludes amortization of intangible assets and merger, asset disposition and restructuring expenses (non-GAAP). |
Northwest Bancshares, Inc. and Subsidiaries | |||
Consolidated Statements of Income (Unaudited) | |||
(dollars in thousands, except per share amounts) | |||
Year ended December 31, | |||
2021 | 2020 | ||
Interest income: | |||
Loans receivable | $ 390,343 | 410,907 | |
Mortgage-backed securities | 21,463 | 17,416 | |
Taxable investment securities | 2,616 | 1,985 | |
Tax-free investment securities | 2,485 | 2,060 | |
FHLB dividends | 407 | 981 | |
Interest-earning deposits | 1,194 | 719 | |
Total interest income | 418,508 | 434,068 | |
Interest expense: | |||
Deposits | 19,122 | 35,896 | |
Borrowed funds | 8,124 | 6,444 | |
Total interest expense | 27,246 | 42,340 | |
Net interest income | 391,262 | 391,728 | |
Provision for credit losses | (11,883) | 83,975 | |
Net interest income after provision for credit losses | 403,145 | 307,753 | |
Noninterest income: | |||
Gain/(loss) on sale of investments | (176) | 236 | |
Gain on sale of loans | — | 1,302 | |
Service charges and fees | 51,837 | 55,613 | |
Trust and other financial services income | 27,921 | 20,922 | |
Insurance commission income | 3,633 | 9,132 | |
Gain/(loss) on real estate owned, net | 442 | (106) | |
Income from bank-owned life insurance | 6,050 | 5,190 | |
Mortgage banking income | 15,892 | 31,391 | |
Gain on sale of insurance business | 25,327 | — | |
Other operating income | 11,963 | 8,585 | |
Total noninterest income | 142,889 | 132,265 | |
Noninterest expense: | |||
Compensation and employee benefits | 193,887 | 178,375 | |
Premises and occupancy costs | 31,073 | 30,622 | |
Office operations | 13,769 | 15,728 | |
Collections expense | 1,932 | 3,275 | |
Processing expenses | 55,763 | 50,050 | |
Marketing expenses | 8,237 | 7,695 | |
Federal deposit insurance premiums | 4,975 | 4,767 | |
Professional services | 17,621 | 12,482 | |
Amortization of intangible assets | 5,553 | 6,856 | |
Real estate owned expense | 298 | 359 | |
Merger, asset disposition and restructuring expense | 3,453 | 20,789 | |
Other expenses | 8,349 | 16,494 | |
Total noninterest expense | 344,910 | 347,492 | |
Income before income taxes | 201,124 | 92,526 | |
Income tax expense | 46,801 | 17,672 | |
Net income | $ 154,323 | 74,854 | |
Basic earnings per share | $ 1.22 | 0.62 | |
Diluted earnings per share | $ 1.21 | 0.62 | |
Annualized return on average equity | 9.91 % | 4.72 % | |
Annualized return on average assets | 1.08 % | 0.58 % | |
Annualized return on tangible common equity * | 12.97 % | 6.59 % | |
Efficiency ratio ** | 66.02 % | 61.04 % | |
Annualized noninterest expense to average assets *** | 2.35 % | 2.48 % | |
* | Excludes goodwill and other intangible assets (non-GAAP). |
** | Excludes gain on sale of insurance business, amortization of intangible assets and merger, asset disposition and restructuring expenses (non-GAAP). |
*** | Excludes amortization of intangible assets and merger, asset disposition and restructuring expenses (non-GAAP). |
Northwest Bancshares, Inc. and Subsidiaries | |||||||||
Asset Quality (Unaudited) | |||||||||
(dollars in thousands) | |||||||||
December 31,2021 | September 30,2021 | June 30,2021 | March 31,2021 | December 31,2020 | |||||
Nonaccrual loans current: | |||||||||
Residential mortgage loans | $ 1,354 | 2,015 | 189 | 164 | 21 | ||||
Home equity loans | 1,212 | 1,267 | 170 | 268 | 154 | ||||
Consumer loans | 1,336 | 1,465 | 188 | 225 | 207 | ||||
Commercial real estate loans | 106,233 | 111,075 | 138,820 | 146,304 | 20,317 | ||||
Commercial loans | 6,098 | 17,021 | 17,545 | 6,361 | 16,027 | ||||
Total nonaccrual loans current | $ 116,233 | 132,843 | 156,912 | 153,322 | 36,726 | ||||
Nonaccrual loans delinquent 30 days to 59 days: | |||||||||
Residential mortgage loans | $ 244 | 99 | 68 | 1,261 | 647 | ||||
Home equity loans | 223 | 328 | 229 | 340 | 338 | ||||
Consumer loans | 241 | 152 | 230 | 254 | 301 | ||||
Commercial real estate loans | 239 | 205 | 1,589 | 965 | 1,416 | ||||
Commercial loans | 53 | 102 | 406 | 1,538 | 87 | ||||
Total nonaccrual loans delinquent 30 days to 59 days | $ 1,000 | 886 | 2,522 | 4,358 | 2,789 | ||||
Nonaccrual loans delinquent 60 days to 89 days: | |||||||||
Residential mortgage loans | $ 1,163 | 527 | 207 | 813 | 767 | ||||
Home equity loans | 61 | 142 | 310 | 417 | 190 | ||||
Consumer loans | 292 | 291 | 297 | 649 | 583 | ||||
Commercial real estate loans | 364 | 419 | 198 | 1,877 | 714 | ||||
Commercial loans | 218 | 170 | 21 | 7,919 | 48 | ||||
Total nonaccrual loans delinquent 60 days to 89 days | $ 2,098 | 1,549 | 1,033 | 11,675 | 2,302 | ||||
Nonaccrual loans delinquent 90 days or more: | |||||||||
Residential mortgage loans | $ 7,641 | 8,069 | 10,007 | 9,333 | 14,489 | ||||
Home equity loans | 4,262 | 4,745 | 6,256 | 7,044 | 8,441 | ||||
Consumer loans | 2,069 | 2,184 | 2,341 | 3,625 | 5,473 | ||||
Commercial real estate loans | 24,063 | 25,562 | 23,564 | 29,737 | 25,287 | ||||
Commercial loans | 1,105 | 1,104 | 4,126 | 4,860 | 7,325 | ||||
Total nonaccrual loans delinquent 90 days or more | $ 39,140 | 41,664 | 46,294 | 54,599 | 61,015 | ||||
Total nonaccrual loans | $ 158,471 | 176,942 | 206,761 | 223,954 | 102,832 | ||||
Total nonaccrual loans | $ 158,471 | 176,942 | 206,761 | 223,954 | 102,832 | ||||
Loans 90 days past due and still accruing | 331 | 386 | 302 | 197 | 585 | ||||
Nonperforming loans | 158,802 | 177,328 | 207,063 | 224,151 | 103,417 | ||||
Real estate owned, net | 873 | 809 | 1,353 | 1,738 | 2,232 | ||||
Nonperforming assets | $ 159,675 | 178,137 | 208,416 | 225,889 | 105,649 | ||||
Nonaccrual troubled debt restructuring * | $ 17,216 | 12,858 | 8,951 | 7,390 | 10,704 | ||||
Accruing troubled debt restructuring | 13,072 | 13,664 | 18,480 | 20,120 | 21,431 | ||||
Total troubled debt restructuring | $ 30,288 | 26,522 | 27,431 | 27,510 | 32,135 | ||||
Nonperforming loans to total loans | 1.59 % | 1.74 % | 2.01 % | 2.16 % | 0.98 % | ||||
Nonperforming assets to total assets | 1.10 % | 1.24 % | 1.46 % | 1.58 % | 0.77 % | ||||
Allowance for credit losses to total loans | 1.02 % | 1.08 % | 1.14 % | 1.20 % | 1.27 % | ||||
Allowance for total loans excluding PPP loan balances | 1.03 % | 1.09 % | 1.17 % | 1.24 % | 1.32 % | ||||
Allowance for credit losses to nonperforming loans | 64.38 % | 61.90 % | 56.66 % | 55.32 % | 129.99 % | ||||
* | Amounts included in nonperforming loans above. |
Northwest Bancshares, Inc. and Subsidiaries | ||||||||||||
Loans by Credit Quality Indicators (Unaudited) | ||||||||||||
(dollars in thousands) | ||||||||||||
At December 31, 2021 | Pass | Special mention* | Substandard ** | Doubtful | Loss | Loans receivable | ||||||
Personal Banking: | ||||||||||||
Residential mortgage loans | $ 2,978,080 | — | 16,540 | — | — | 2,994,620 | ||||||
Home equity loans | 1,312,820 | — | 7,111 | — | — | 1,319,931 | ||||||
Consumer loans | 1,834,478 | — | 4,270 | — | — | 1,838,748 | ||||||
Total Personal Banking | 6,125,378 | — | 27,921 | — | — | 6,153,299 | ||||||
Commercial Banking: | ||||||||||||
Commercial real estate loans | 2,639,676 | 74,123 | 301,685 | — | — | 3,015,484 | ||||||
Commercial loans | 808,323 | 5,730 | 33,556 | — | — | 847,609 | ||||||
Total Commercial Banking | 3,447,999 | 79,853 | 335,241 | — | — | 3,863,093 | ||||||
Total loans | $ 9,573,377 | 79,853 | 363,162 | — | — | 10,016,392 | ||||||
At September 30, 2021 | ||||||||||||
Personal Banking: | ||||||||||||
Residential mortgage loans | $ 2,972,489 | — | 17,032 | — | — | 2,989,521 | ||||||
Home equity loans | 1,342,479 | — | 7,869 | — | — | 1,350,348 | ||||||
Consumer loans | 1,812,360 | — | 4,476 | — | — | 1,816,836 | ||||||
Total Personal Banking | 6,127,328 | — | 29,377 | — | — | 6,156,705 | ||||||
Commercial Banking: | ||||||||||||
Commercial real estate loans | 2,799,592 | 63,034 | 299,925 | — | — | 3,162,551 | ||||||
Commercial loans | 813,665 | 10,976 | 55,071 | — | — | 879,712 | ||||||
Total Commercial Banking | 3,613,257 | 74,010 | 354,996 | — | — | 4,042,263 | ||||||
Total loans | $ 9,740,585 | 74,010 | 384,373 | — | — | 10,198,968 | ||||||
At June 30, 2021 | ||||||||||||
Personal Banking: | ||||||||||||
Residential mortgage loans | $ 2,937,418 | — | 17,133 | — | — | 2,954,551 | ||||||
Home equity loans | 1,367,765 | — | 8,463 | — | — | 1,376,228 | ||||||
Consumer loans | 1,741,872 | — | 3,359 | — | — | 1,745,231 | ||||||
Total Personal Banking | 6,047,055 | — | 28,955 | — | — | 6,076,010 | ||||||
Commercial Banking: | ||||||||||||
Commercial real estate loans | 2,781,734 | 73,167 | 360,288 | — | — | 3,215,189 | ||||||
Commercial loans | 943,665 | 11,266 | 63,850 | — | — | 1,018,781 | ||||||
Total Commercial Banking | 3,725,399 | 84,433 | 424,138 | — | — | 4,233,970 | ||||||
Total loans | $ 9,772,454 | 84,433 | 453,093 | — | — | 10,309,980 | ||||||
At March 31, 2021 | ||||||||||||
Personal Banking: | ||||||||||||
Residential mortgage loans | $ 2,950,103 | — | 21,575 | — | — | 2,971,678 | ||||||
Home equity loans | 1,396,757 | — | 10,767 | — | — | 1,407,524 | ||||||
Consumer loans | 1,547,502 | — | 6,853 | — | — | 1,554,355 | ||||||
Total Personal Banking | 5,894,362 | — | 39,195 | — | — | 5,933,557 | ||||||
Commercial Banking: | ||||||||||||
Commercial real estate loans | 2,801,082 | 120,345 | 368,009 | — | — | 3,289,436 | ||||||
Commercial loans | 1,061,884 | 22,623 | 60,540 | — | — | 1,145,047 | ||||||
Total Commercial Banking | 3,862,966 | 142,968 | 428,549 | — | — | 4,434,483 | ||||||
Total loans | $ 9,757,328 | 142,968 | 467,744 | — | — | 10,368,040 | ||||||
At December 31, 2020 | ||||||||||||
Personal Banking: | ||||||||||||
Residential mortgage loans | $ 3,042,544 | — | 25,577 | — | — | 3,068,121 | ||||||
Home equity loans | 1,455,474 | — | 12,262 | — | — | 1,467,736 | ||||||
Consumer loans | 1,499,004 | — | 8,989 | — | — | 1,507,993 | ||||||
Total Personal Banking | 5,997,022 | — | 46,828 | — | — | 6,043,850 | ||||||
Commercial Banking: | ||||||||||||
Commercial real estate loans | 2,852,705 | 108,021 | 385,163 | — | — | 3,345,889 | ||||||
Commercial loans | 1,092,498 | 41,278 | 57,334 | — | — | 1,191,110 | ||||||
Total Commercial Banking | 3,945,203 | 149,299 | 442,497 | — | — | 4,536,999 | ||||||
Total loans | $ 9,942,225 | 149,299 | 489,325 | — | — | 10,580,849 | ||||||
* | Includes $14.9 million, $16.7 million, $16.7 million, $26.4 million, and $31.3 million of acquired loans at December 31, 2021, September 30, 2021, June 30, 2021, March 31, 2021, and December 31, 2020, respectively. |
** | Includes $81.5 million, $110.4 million, $122.5 million, $143.2 million, and $153.2 million of acquired loans at December 31, 2021, September 30, 2021, June 30, 2021, March 31, 2021, and December 31, 2020, respectively. |
Northwest Bancshares, Inc. and Subsidiaries | ||||||||||||||||||||||||||||||
Loan Delinquency (Unaudited) | ||||||||||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||||
December 31,2021 | * | September 30, 2021 | * | June 30,2021 | * | March 31,2021 | * | December 31,2020 | * | |||||||||||||||||||||
(Number of loans and dollar amount of loans) | ||||||||||||||||||||||||||||||
Loans delinquent 30 days to 59 days: | ||||||||||||||||||||||||||||||
Residential mortgage loans | 277 | $ 20,567 | 0.7 % | 17 | $ 765 | — % | 13 | $ 606 | — % | 248 | $ 22,236 | 0.7 % | 315 | $ 28,797 | 0.9 % | |||||||||||||||
Home equity loans | 112 | 3,153 | 0.2 % | 101 | 3,351 | 0.2 % | 91 | 3,677 | 0.3 % | 84 | 3,334 | 0.2 % | 138 | 4,763 | 0.3 % | |||||||||||||||
Consumer loans | 589 | 6,536 | 0.4 % | 576 | 6,146 | 0.3 % | 532 | 5,571 | 0.3 % | 535 | 5,732 | 0.4 % | 1,279 | 10,574 | 0.7 % | |||||||||||||||
Commercial real estate loans | 17 | 17,065 | 0.6 % | 19 | 2,004 | 0.1 % | 13 | 2,857 | 0.1 % | 33 | 12,240 | 0.4 % | 43 | 10,923 | 0.3 % | |||||||||||||||
Commercial loans | 12 | 193 | — % | 10 | 692 | 0.1 % | 15 | 686 | 0.1 % | 16 | 3,032 | 0.3 % | 37 | 6,405 | 0.5 % | |||||||||||||||
Total loans delinquent 30 days to 59 days | 1,007 | $ 47,514 | 0.5 % | 723 | $ 12,958 | 0.1 % | 664 | $ 13,397 | 0.1 % | 916 | $ 46,574 | 0.4 % | 1,812 | $ 61,462 | 0.6 % | |||||||||||||||
Loans delinquent 60 days to 89 days: | ||||||||||||||||||||||||||||||
Residential mortgage loans | 59 | $ 5,433 | 0.2 % | 55 | $ 4,907 | 0.2 % | 58 | $ 4,051 | 0.1 % | 26 | $ 2,062 | 0.1 % | 84 | $ 5,083 | 0.2 % | |||||||||||||||
Home equity loans | 30 | 949 | 0.1 % | 29 | 1,024 | 0.1 % | 36 | 1,502 | 0.1 % | 31 | 953 | 0.1 % | 47 | 1,656 | 0.1 % | |||||||||||||||
Consumer loans | 195 | 2,006 | 0.1 % | 180 | 1,757 | 0.1 % | 181 | 1,988 | 0.1 % | 169 | 1,868 | 0.1 % | 322 | 2,742 | 0.2 % | |||||||||||||||
Commercial real estate loans | 5 | 769 | — % | 8 | 1,170 | — % | 9 | 1,335 | — % | 14 | 7,609 | 0.2 % | 11 | 1,615 | — % | |||||||||||||||
Commercial loans | 10 | 727 | 0.1 % | 2 | 170 | — % | 2 | 27 | — % | 12 | 8,979 | 0.8 % | 10 | 864 | 0.1 % | |||||||||||||||
Total loans delinquent 60 days to 89 days | 299 | $ 9,884 | 0.1 % | 274 | $ 9,028 | 0.1 % | 286 | $ 8,903 | 0.1 % | 252 | $ 21,471 | 0.2 % | 474 | $ 11,960 | 0.1 % | |||||||||||||||
Loans delinquent 90 days or more: ** | ||||||||||||||||||||||||||||||
Residential mortgage loans | 87 | $ 7,641 | 0.3 % | 95 | $ 8,069 | 0.3 % | 115 | $ 10,007 | 0.3 % | 121 | $ 9,333 | 0.3 % | 168 | $ 14,489 | 0.5 % | |||||||||||||||
Home equity loans | 105 | 4,262 | 0.3 % | 119 | 4,745 | 0.4 % | 146 | 6,256 | 0.5 % | 176 | 7,044 | 0.5 % | 207 | 8,441 | 0.6 % | |||||||||||||||
Consumer loans | 296 | 2,400 | 0.1 % | 308 | 2,568 | 0.1 % | 356 | 2,643 | 0.2 % | 454 | 3,822 | 0.2 % | 720 | 6,058 | 0.4 % | |||||||||||||||
Commercial real estate loans | 52 | 24,063 | 0.8 % | 59 | 25,562 | 0.8 % | 83 | 23,564 | 0.7 % | 113 | 29,737 | 0.9 % | 119 | 25,287 | 0.8 % | |||||||||||||||
Commercial loans | 8 | 1,105 | 0.1 % | 10 | 1,104 | 0.1 % | 18 | 4,126 | 0.4 % | 31 | 4,860 | 0.4 % | 37 | 7,325 | 0.6 % | |||||||||||||||
Total loans delinquent 90 days or more | 548 | $ 39,471 | 0.4 % | 591 | $ 42,048 | 0.4 % | 718 | $ 46,596 | 0.5 % | 895 | $ 54,796 | 0.5 % | 1,251 | $ 61,600 | 0.6 % | |||||||||||||||
Total loans delinquent | 1,854 | $ 96,869 | 1.0 % | 1,588 | $ 64,034 | 0.6 % | 1,668 | $ 68,896 | 0.7 % | 2,063 | $ 122,841 | 1.2 % | 3,537 | $ 135,022 | 1.3 % | |||||||||||||||
* | Represents delinquency, in dollars, divided by the respective total amount of that type of loan outstanding. |
** | Includes purchased credit deteriorated loans of $7.3 million, $8.4 million, $10.3 million, $12.7 million, and $6.6 million at December 31, 2021, September 30, 2021, June 30, 2021, March 31, 2021, and December 31, 2020. |
Northwest Bancshares, Inc. and Subsidiaries | |||||||||
Allowance for Credit Losses (Unaudited) | |||||||||
(dollars in thousands) | |||||||||
Quarter ended | |||||||||
December 31,2021 | September 30,2021 | June 30,2021 | March 31,2021 | December 31,2020 | |||||
Beginning balance | $ 109,767 | 117,330 | 123,997 | 134,427 | 140,209 | ||||
Provision | (1,909) | (4,354) | — | (5,620) | (2,230) | ||||
Charge-offs residential mortgage | (784) | (1,263) | (770) | (855) | (407) | ||||
Charge-offs home equity | (1,299) | (1,474) | (379) | (228) | (58) | ||||
Charge-offs consumer | (2,897) | (2,148) | (2,401) | (2,603) | (2,623) | ||||
Charge-offs commercial real estate | (2,652) | (1,581) | (3,964) | (4,626) | (2,770) | ||||
Charge-offs commercial | (2,586) | (412) | (1,161) | (54) | (156) | ||||
Recoveries | 4,601 | 3,669 | 2,008 | 3,556 | 2,462 | ||||
Ending balance | $ 102,241 | 109,767 | 117,330 | 123,997 | 134,427 | ||||
Net charge-offs to average loans, annualized | 0.22 % | 0.12 % | 0.26 % | 0.19 % | 0.13 % | ||||
Year ended December 31, | |||
2021 | 2020 | ||
Beginning balance | $ 134,427 | 57,941 | |
CECL adoption | — | 10,792 | |
Initial allowance on loans purchased with credit deterioration | — | 8,845 | |
Provision | (11,883) | 83,975 | |
Charge-offs residential mortgage | (3,672) | (917) | |
Charge-offs home equity | (3,380) | (608) | |
Charge-offs consumer | (10,049) | (12,658) | |
Charge-offs commercial real estate | (12,823) | (4,323) | |
Charge-offs commercial | (4,213) | (16,212) | |
Recoveries | 13,834 | 7,592 | |
Ending balance | $ 102,241 | 134,427 | |
Net charge-offs to average loans | 0.20 % | 0.27 % | |
December 31, 2021 | |||||||||||
Originated loans | Acquired loans | Total loans | |||||||||
Balance | Reserve | Balance | Reserve | Balance | Reserve | ||||||
Residential mortgage loans | $ 2,783,459 | 6,621 | 211,161 | 752 | 2,994,620 | 7,373 | |||||
Home equity loans | 1,107,202 | 4,243 | 212,729 | 1,057 | 1,319,931 | 5,300 | |||||
Consumer loans | 1,692,207 | 16,775 | 146,541 | 1,592 | 1,838,748 | 18,367 | |||||
Personal Banking Loans | 5,582,868 | 27,639 | 570,431 | 3,401 | 6,153,299 | 31,040 | |||||
Commercial real estate loans | 2,523,280 | 48,503 | 492,204 | 9,521 | 3,015,484 | 58,024 | |||||
Commercial loans | 765,877 | 10,608 | 81,732 | 2,569 | 847,609 | 13,177 | |||||
Commercial Banking Loans | 3,289,157 | 59,111 | 573,936 | 12,090 | 3,863,093 | 71,201 | |||||
Total Loans | $ 8,872,025 | 86,750 | 1,144,367 | 15,491 | 10,016,392 | 102,241 | |||||
Northwest Bancshares, Inc. and Subsidiaries | |||||||||||||||||||||||||||||
Average Balance Sheet (Unaudited) | |||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||
The following table sets forth certain information relating to the Company's average balance sheet and reflects the average yield on assets and average cost of liabilities for the periods indicated. Such yields and costs are derived by dividing income or expense by the average balance of assets or liabilities, respectively, for the periods presented. Average balances are calculated using daily averages. | |||||||||||||||||||||||||||||
Quarter ended | |||||||||||||||||||||||||||||
December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||
Average balance | Interest | Avg. yield/ cost (i) | Average balance | Interest | Avg. yield/ cost (i) | Average balance | Interest | Avg. yield/ cost (i) | Average balance | Interest | Avg. yield/ cost (i) | Average balance | Interest | Avg. yield/ cost (i) | |||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||||||||
Residential mortgage loans | $ 2,977,942 | 25,269 | 3.39 % | $ 2,959,794 | 25,398 | 3.43 % | $ 2,935,034 | 25,609 | 3.49 % | $ 3,007,439 | 26,366 | 3.51 % | $ 3,089,916 | 27,503 | 3.56 % | ||||||||||||||
Home equity loans | 1,328,553 | 11,750 | 3.51 % | 1,356,131 | 11,993 | 3.51 % | 1,380,794 | 12,232 | 3.55 % | 1,432,009 | 12,815 | 3.63 % | 1,472,527 | 13,535 | 3.66 % | ||||||||||||||
Consumer loans | 1,756,620 | 15,514 | 3.50 % | 1,728,563 | 16,220 | 3.72 % | 1,589,739 | 14,555 | 3.67 % | 1,463,284 | 14,566 | 4.04 % | 1,444,860 | 15,874 | 4.37 % | ||||||||||||||
Commercial real estate loans | 3,113,924 | 34,062 | 4.28 % | 3,205,839 | 35,305 | 4.31 % | 3,257,810 | 33,349 | 4.05 % | 3,313,892 | 38,471 | 4.64 % | 3,317,418 | 37,965 | 4.48 % | ||||||||||||||
Commercial loans | 855,998 | 9,154 | 4.18 % | 975,603 | 9,096 | 3.65 % | 1,133,969 | 9,978 | 3.48 % | 1,189,812 | 10,566 | 3.55 % | 1,325,047 | 11,414 | 3.37 % | ||||||||||||||
Total loans receivable (a) (b) (d) | 10,033,037 | 95,749 | 3.79 % | 10,225,930 | 98,012 | 3.80 % | 10,297,346 | 95,723 | 3.73 % | 10,406,436 | 102,784 | 4.01 % | 10,649,768 | 106,291 | 3.97 % | ||||||||||||||
Mortgage-backed securities (c) | 1,894,683 | 5,743 | 1.21 % | 1,832,876 | 5,840 | 1.27 % | 1,756,227 | 5,680 | 1.29 % | 1,324,558 | 4,200 | 1.27 % | 1,166,739 | 4,551 | 1.56 % | ||||||||||||||
Investment securities (c) (d) | 358,558 | 1,535 | 1.71 % | 348,619 | 1,466 | 1.68 % | 364,414 | 1,466 | 1.61 % | 331,358 | 1,381 | 1.67 % | 252,898 | 1,380 | 2.18 % | ||||||||||||||
FHLB stock, at cost | 14,459 | 82 | 2.25 % | 21,607 | 71 | 1.31 % | 23,107 | 138 | 2.40 % | 21,811 | 116 | 2.17 % | 23,346 | 192 | 3.27 % | ||||||||||||||
Other interest-earning deposits | 1,168,449 | 467 | 0.16 % | 905,130 | 352 | 0.15 % | 810,741 | 192 | 0.09 % | 801,119 | 183 | 0.09 % | 632,494 | 178 | 0.11 % | ||||||||||||||
Total interest-earning assets | 13,469,186 | 103,576 | 3.05 % | 13,334,162 | 105,741 | 3.15 % | 13,251,835 | 103,199 | 3.12 % | 12,885,282 | 108,664 | 3.42 % | 12,725,245 | 112,592 | 3.52 % | ||||||||||||||
Noninterest-earning assets (e) | 1,004,905 | 1,074,122 | 1,104,924 | 1,102,477 | 1,066,609 | ||||||||||||||||||||||||
Total assets | $ 14,474,091 | $ 14,408,284 | $ 14,356,759 | $ 13,987,759 | $ 13,791,854 | ||||||||||||||||||||||||
Liabilities and shareholders' equity: | |||||||||||||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||||||||
Savings deposits | $ 2,282,606 | 622 | 0.11 % | $ 2,271,365 | 603 | 0.11 % | $ 2,255,578 | 590 | 0.10 % | $ 2,118,030 | 625 | 0.12 % | $ 2,028,155 | 617 | 0.12 % | ||||||||||||||
Interest-bearing demand deposits | 2,933,466 | 411 | 0.06 % | 2,890,905 | 414 | 0.06 % | 2,840,949 | 407 | 0.06 % | 2,783,429 | 429 | 0.06 % | 2,699,515 | 476 | 0.07 % | ||||||||||||||
Money market deposit accounts | 2,618,177 | 656 | 0.10 % | 2,565,159 | 637 | 0.10 % | 2,537,629 | 621 | 0.10 % | 2,497,495 | 657 | 0.11 % | 2,426,513 | 960 | 0.16 % | ||||||||||||||
Time deposits | 1,356,513 | 2,606 | 0.76 % | 1,423,041 | 2,886 | 0.80 % | 1,493,947 | 3,155 | 0.85 % | 1,583,525 | 3,803 | 0.97 % | 1,676,094 | 4,660 | 1.11 % | ||||||||||||||
Borrowed funds (f) | 135,038 | 159 | 0.47 % | 131,199 | 154 | 0.47 % | 131,240 | 150 | 0.46 % | 143,806 | 154 | 0.43 % | 229,109 | 213 | 0.37 % | ||||||||||||||
Subordinated debt (g) | 123,514 | 1,180 | 3.82 % | 123,513 | 1,277 | 4.10 % | 123,443 | 1,264 | 4.11 % | 123,357 | 1,258 | 4.14 % | 123,283 | 1,256 | 4.05 % | ||||||||||||||
Junior subordinated debentures | 129,012 | 625 | 1.89 % | 128,946 | 625 | 1.90 % | 128,882 | 636 | 1.95 % | 128,817 | 642 | 1.99 % | 128,752 | 659 | 2.00 % | ||||||||||||||
Total interest-bearing liabilities | 9,578,326 | 6,259 | 0.26 % | 9,534,128 | 6,596 | 0.27 % | 9,511,668 | 6,823 | 0.29 % | 9,378,459 | 7,568 | 0.33 % | 9,311,421 | 8,841 | 0.38 % | ||||||||||||||
Noninterest-bearing demand deposits (h) | 3,093,518 | 3,058,819 | 3,036,202 | 2,805,206 | 2,675,986 | ||||||||||||||||||||||||
Noninterest-bearing liabilities | 242,620 | 244,402 | 247,930 | 265,667 | 253,966 | ||||||||||||||||||||||||
Total liabilities | 12,914,464 | 12,837,349 | 12,795,800 | 12,449,332 | 12,241,373 | ||||||||||||||||||||||||
Shareholders' equity | 1,559,627 | 1,570,935 | 1,560,959 | 1,538,427 | 1,550,481 | ||||||||||||||||||||||||
Total liabilities and shareholders' equity | $ 14,474,091 | $ 14,408,284 | $ 14,356,759 | $ 13,987,759 | $ 13,791,854 | ||||||||||||||||||||||||
Net interest income/Interest rate spread | 97,317 | 2.79 % | 99,145 | 2.87 % | 96,376 | 2.84 % | 101,096 | 3.09 % | 103,751 | 3.14 % | |||||||||||||||||||
Net interest-earning assets/Net interest margin | $ 3,890,860 | 2.89 % | $ 3,800,034 | 2.97 % | $ 3,740,167 | 2.91 % | $ 3,506,823 | 3.18 % | $ 3,413,824 | 3.26 % | |||||||||||||||||||
Ratio of interest-earning assets to interest-bearing liabilities | 1.41X | 1.40X | 1.39X | 1.37X | 1.37X | ||||||||||||||||||||||||
(a) | Average gross loans receivable includes loans held as available-for-sale and loans placed on nonaccrual status. |
(b) | Interest income includes accretion/amortization of deferred loan fees/expenses, which was not material. |
(c) | Average balances do not include the effect of unrealized gains or losses on securities held as available-for-sale. |
(d) | Interest income on tax-free investment securities and tax-free loans are presented on a fully taxable equivalent ("FTE") basis. |
(e) | Average balances include the effect of unrealized gains or losses on securities held as available-for-sale. |
(f) | Average balances include FHLB borrowings, collateralized borrowings. |
(g) | On September 9, 2020, the Company issued $125.0 million of 4.00% fixed-to-floating rate subordinated notes with a maturity of September 15, 2030. |
(h) | Average cost of deposits were 0.14%, 0.15%, 0.16%, 0.19%, and 0.23%, respectively. |
(i) | Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans — 3.77%, 3.79%, 3.71%, 3.99%, and 3.94%, respectively, Investment securities — 1.48%, 1.47%, 1.41%, 1.46%, and 1.78%, respectively, Interest-earning assets — 3.03%, 3.13%, 3.10%, 3.40%, and 3.48%, respectively. GAAP basis net interest rate spreads were 2.77%, 2.86%, 2.82%, 3.07%, and 3.11%, respectively, and GAAP basis net interest margins were 2.87%, 2.95%, 2.89%, 3.16%, and 3.23%, respectively. |
Northwest Bancshares, Inc. and Subsidiaries | |||||||||||
Average Balance Sheet (Unaudited) | |||||||||||
(dollars in thousands) | |||||||||||
The following table sets forth certain information relating to the Company's average balance sheet and reflects the average yield on assets and average cost of liabilities for the periods indicated. Such yields and costs are derived by dividing income or expense by the average balance of assets or liabilities, respectively, for the periods presented. Average balances are calculated using daily averages. | |||||||||||
Year ended December 31, | |||||||||||
2021 | 2020 | ||||||||||
Average balance | Interest | Avg. yield/ cost (i) | Average balance | Interest | Avg. yield/ cost (i) | ||||||
Assets: | |||||||||||
Interest-earning assets: | |||||||||||
Residential mortgage loans | $ 2,969,939 | 102,642 | 3.46 % | $ 3,051,582 | 113,353 | 3.71 % | |||||
Home equity loans | 1,374,038 | 48,789 | 3.55 % | 1,436,632 | 55,875 | 3.89 % | |||||
Consumer loans | 1,635,613 | 60,854 | 3.72 % | 1,338,120 | 58,878 | 4.40 % | |||||
Commercial real estate loans | 3,222,272 | 141,186 | 4.32 % | 3,132,976 | 140,883 | 4.42 % | |||||
Commercial loans | 1,037,758 | 38,794 | 3.69 % | 1,145,143 | 44,142 | 3.79 % | |||||
Loans receivable (a) (b) (d) | 10,239,620 | 392,265 | 3.83 % | 10,104,453 | 413,131 | 4.09 % | |||||
Mortgage-backed securities (c) | 1,704,006 | 21,463 | 1.26 % | 889,744 | 17,416 | 1.96 % | |||||
Investment securities (c) (d) | 350,806 | 5,848 | 1.67 % | 196,071 | 4,841 | 2.47 % | |||||
FHLB stock, at cost | 20,229 | 407 | 2.01 % | 21,781 | 981 | 4.50 % | |||||
Other interest-earning deposits | 921,360 | 1,194 | 0.13 % | 520,666 | 719 | 0.14 % | |||||
Total interest-earning assets | 13,236,021 | 421,177 | 3.18 % | 11,732,715 | 437,088 | 3.73 % | |||||
Noninterest-earning assets (e) | 1,072,313 | 1,159,405 | |||||||||
Total assets | $ 14,308,334 | $ 12,892,120 | |||||||||
Liabilities and shareholders' equity: | |||||||||||
Interest-bearing liabilities: | |||||||||||
Savings deposits | $ 2,232,454 | 2,440 | 0.11 % | $ 1,885,517 | 2,640 | 0.14 % | |||||
Interest-bearing demand deposits | 2,862,677 | 1,660 | 0.06 % | 2,432,427 | 3,358 | 0.14 % | |||||
Money market deposit accounts | 2,554,975 | 2,570 | 0.10 % | 2,224,904 | 6,995 | 0.31 % | |||||
Time deposits | 1,463,522 | 12,452 | 0.85 % | 1,687,381 | 22,903 | 1.36 % | |||||
Borrowed funds (f) | 135,285 | 616 | 0.46 % | 346,442 | 3,190 | 0.92 % | |||||
Subordinated debt (g) | 123,457 | 4,980 | 4.03 % | — | — | — % | |||||
Junior subordinated debentures | 128,915 | 2,528 | 1.93 % | 126,683 | 3,254 | 2.53 % | |||||
Total interest-bearing liabilities | 9,501,285 | 27,246 | 0.29 % | 8,703,354 | 42,340 | 0.49 % | |||||
Noninterest-bearing demand deposits (h) | 2,999,392 | 2,357,725 | |||||||||
Noninterest-bearing liabilities | 250,075 | 246,294 | |||||||||
Total liabilities | 12,750,752 | 11,307,373 | |||||||||
Shareholders' equity | 1,557,582 | 1,584,747 | |||||||||
Total liabilities and shareholders' equity | $ 14,308,334 | $ 12,892,120 | |||||||||
Net interest income/Interest rate spread | 393,931 | 2.89 % | 394,748 | 3.24 % | |||||||
Net interest-earning assets/Net interest margin | $ 3,734,736 | 2.98 % | $ 3,029,361 | 3.36 % | |||||||
Ratio of interest-earning assets to interest-bearing liabilities | 1.39X | 1.35X | |||||||||
(a) | Average gross loans receivable includes loans held as available-for-sale and loans placed on nonaccrual status. |
(b) | Interest income includes accretion/amortization of deferred loan fees/expenses, which was not material. |
(c) | Average balances do not include the effect of unrealized gains or losses on securities held as available-for-sale. |
(d) | Interest income on tax-free investment securities and tax-free loans are presented on a FTE basis. |
(e) | Average balances include the effect of unrealized gains or losses on securities held as available-for-sale. |
(f) | Average balances include FHLB borrowings and collateralized borrowings. |
(g) | On September 9, 2020, the Company issued $125.0 million of 4.00% fixed-to-floating rate subordinated notes with a maturity of September 15, 2030. |
(h) | Average cost of deposits were 0.16% and 0.34%, respectively. |
(i) | Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans — 3.81% and 4.07%, respectively, Investment securities — 1.45% and 2.06%, respectively, Interest-earning assets — 3.16% and 3.70%, respectively. GAAP basis net interest rate spreads were 2.88% and 3.21%, respectively, and GAAP basis net interest margins were 2.96% and 3.34%, respectively. |
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SOURCE Northwest Bancshares, Inc.