COLUMBUS, Ohio, Oct. 23, 2023 /PRNewswire/ -- Northwest Bancshares, Inc., (the "Company"), (NasdaqGS: NWBI) announced net income for the quarter ended September 30, 2023 of $39.2 million, or $0.31 per diluted share. This represents an increase of $1.9 million, or 5.1%, compared to the same quarter last year, when net income was $37.3 million, or $0.29 per diluted share. The annualized returns on average shareholders' equity and average assets for the quarter ended September 30, 2023 were 10.27% and 1.08% compared to 9.84% and 1.05% 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 November 14, 2023 to shareholders of record as of November 2, 2023. This is the 116th consecutive quarter in which the Company has paid a cash dividend. Based on the market value of the Company's common stock as of September 30, 2023, this represents an annualized dividend yield of approximately 7.8%.
Louis J. Torchio, President and CEO, added, "Despite the economic, liquidity and interest rate headwinds, we are very pleased with current quarter results including strong net income of $39.2 million, or $0.31 per share. While net interest margins are still a challenge for the industry, we are encouraged by our decline of just five basis points during the quarter. Expenses were higher as we continue to hire the talent and build out the infrastructure necessary to propel the organization to a higher level of performance. Finally, asset quality remains positively resilient and overall stable."
Mr. Torchio continued, "We continue to execute upon our strategic direction of transforming our organization into a more innovative and proactive commercial institution. Our year-to-date commercial loan growth of $480.0 million, or 12.1%, has pushed our overall commercial loan mix from 36% of total loans at the beginning of the year to over 39% at September 30. In addition, noninterest income represented over 22% of total revenue in the current quarter compared to just 19% during the same quarter last year. From a funding perspective, our deposit base remains strong and stable, and we have the advantage of being able to redirect cashflows from investment securities, mortgage loans and consumer loans to continue to grow more profitable commercial relationships."
Net interest income decreased by $4.4 million, or 3.9%, to $108.4 million for the quarter ended September 30, 2023, from $112.7 million for the quarter ended September 30, 2022. This decrease in net interest income resulted primarily from a $37.4 million increase in interest expense as result of increases in both the average balance and average cost of interest-bearing liabilities. The average balance of interest-bearing liabilities increased $603.5 million, or 6.5%, to $9.850 billion for the quarter ended September 30, 2023 from $9.246 billion for the quarter ended September 30, 2022, driven by an increase in time deposits and borrowed funds. In addition, the cost of interest-bearing liabilities increased to 1.74% for the quarter ended September 30, 2023 from 0.25% for the quarter ended September 30, 2022 due to higher market interest rates. Partially offsetting this increase in interest expense was a $33.0 million increase in interest income. Cash and marketable securities were redeployed into higher yielding loans, which, along with higher market interest rates, caused the yield on interest-earning assets to increase to 4.51% for the quarter ended September 30, 2023 from 3.60% for the quarter ended September 30, 2022. Interest income on loans receivable increased $33.7 million, or 31.5%, due to an increase of $710.4 million, or 6.8%, in the average balance of loans in addition to an increase in the yield on loans to 5.01% for the quarter ended September 30, 2023 from 4.07% for the quarter ended September 30, 2022. The net effect of these changes in interest rates and average balances was a decrease in the Company's net interest margin to 3.23% for the quarter ended September 30, 2023 from 3.42% for the same quarter last year.
The provision for credit losses decreased by $10.3 million, or 91.1%, to $1.0 million for the current quarter ended September 30, 2023 from $11.3 million for the quarter ended September 30, 2022. Economic forecasts continued to improve and the Company continued to experience decreases in classified loans by $29.1 million, or 12.2%, to $208.6 million, or 1.84% of total loans, at September 30, 2023 from $237.7 million, or 2.21% of total loans, at September 30, 2022.
Noninterest income increased by $4.1 million, or 15.2%, to $30.9 million for the quarter ended September 30, 2023, from $26.8 million for the quarter ended September 30, 2022. This increase was primarily due to an increase in bank owned life insurance income of $3.1 million, or 209.2%, to $4.6 million for the quarter ended September 30, 2023 from $1.5 million for the quarter ended September 30, 2022 as a result of death benefits received in the current period.
Noninterest expense increased by $8.6 million, or 10.9%, to $87.6 million for the quarter ended September 30, 2023 from $79.0 million for the quarter ended September 30, 2022. This increase primarily resulted from a $4.5 million, or 9.7%, increase in compensation and employee benefits to $51.2 million for the quarter ended September 30, 2023, from $46.7 million for the quarter ended September 30, 2022 driven by increases in salaries and benefits over the past twelve months. Other expenses increased $1.7 million to $2.0 million for the quarter ended September 30, 2023, from $321,000 for the quarter ended September 30, 2022 due to an increase in employee relocation and other expenses. Processing expenses increased $1.3 million, or 9.4%, to $14.7 million for the quarter ended September 30, 2023, from $13.4 million for the quarter ended September 30, 2022 due to the implementation of additional third-party software programs. Lastly, FDIC insurance premiums increased $1.1 million, or 95.1%, to $2.3 million for the quarter ended September 30, 2023 from $1.2 million for the quarter ended September 30, 2022 due to an increase in the deposit insurance assessment rate beginning in the first quarter of 2023.
The provision for income taxes decreased by $522,000, or 4.4%, to $11.5 million for the quarter ended September 30, 2023 from $12.0 million for the quarter ended September 30, 2022 due primarily to a decrease in our effective tax rate in the current year related to BOLI tax benefits.
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, as well as employee benefits and wealth management services. As of September 30, 2023, Northwest operated 134 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 inflation and 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; (7) increased risk associated with commercial real-estate and business loans; (8) changes in liquidity, including the size and composition of our deposit portfolio; (9) reduction in the value of our goodwill and other intangible assets; and (10) the effect of any pandemic, including COVID-19, war or act of terrorism. 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 SubsidiariesConsolidated Statements of Financial Condition (Unaudited)(dollars in thousands, except per share amounts) | |||||
September 30,2023 | December 31,2022 | September 30,2022 | |||
Assets | |||||
Cash and cash equivalents | $ 161,995 | 139,365 | 118,549 | ||
Marketable securities available-for-sale (amortized cost of $1,262,080, $1,431,728 and $1,466,883, respectively) | 1,010,076 | 1,218,108 | 1,251,791 | ||
Marketable securities held-to-maturity (fair value of $682,681, $751,384 and $771,238, respectively) | 830,106 | 881,249 | 899,411 | ||
Total cash and cash equivalents and marketable securities | 2,002,177 | 2,238,722 | 2,269,751 | ||
Loans held-for-sale | 10,592 | 9,913 | 15,834 | ||
Residential mortgage loans | 3,462,606 | 3,488,686 | 3,386,064 | ||
Home equity loans | 1,258,765 | 1,297,674 | 1,284,989 | ||
Consumer loans | 2,155,119 | 2,168,655 | 2,116,238 | ||
Commercial real estate loans | 2,922,582 | 2,823,555 | 2,812,830 | ||
Commercial loans | 1,500,609 | 1,131,969 | 1,125,570 | ||
Total loans receivable | 11,310,273 | 10,920,452 | 10,741,525 | ||
Allowance for credit losses | (124,841) | (118,036) | (109,819) | ||
Loans receivable, net | 11,185,432 | 10,802,416 | 10,631,706 | ||
FHLB stock, at cost | 40,404 | 40,143 | 19,281 | ||
Accrued interest receivable | 42,624 | 35,528 | 29,536 | ||
Real estate owned, net | 363 | 413 | 450 | ||
Premises and equipment, net | 138,041 | 145,909 | 146,173 | ||
Bank-owned life insurance | 250,502 | 255,062 | 255,015 | ||
Goodwill | 380,997 | 380,997 | 380,997 | ||
Other intangible assets, net | 6,013 | 8,560 | 9,491 | ||
Other assets | 315,648 | 205,574 | 210,744 | ||
Total assets | $ 14,362,201 | 14,113,324 | 13,953,144 | ||
Liabilities and shareholders' equity | |||||
Liabilities | |||||
Noninterest-bearing demand deposits | $ 2,774,291 | 2,993,243 | 3,094,120 | ||
Interest-bearing demand deposits | 2,598,080 | 2,686,431 | 2,812,730 | ||
Money market deposit accounts | 2,042,813 | 2,457,569 | 2,577,013 | ||
Savings deposits | 2,116,360 | 2,275,020 | 2,327,419 | ||
Time deposits | 2,258,338 | 1,052,285 | 1,067,110 | ||
Total deposits | 11,789,882 | 11,464,548 | 11,878,392 | ||
Borrowed funds | 604,587 | 681,166 | 150,036 | ||
Subordinated debt | 114,102 | 113,840 | 113,753 | ||
Junior subordinated debentures | 129,509 | 129,314 | 129,249 | ||
Advances by borrowers for taxes and insurance | 27,653 | 47,613 | 29,647 | ||
Accrued interest payable | 7,915 | 3,231 | 831 | ||
Other liabilities | 190,122 | 182,126 | 191,450 | ||
Total liabilities | 12,863,770 | 12,621,838 | 12,493,358 | ||
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, 127,101,349, 127,028,848 and 126,921,989 shares issued and outstanding, respectively | 1,271 | 1,270 | 1,269 | ||
Additional paid-in capital | 1,023,591 | 1,019,647 | 1,017,189 | ||
Retained earnings | 671,092 | 641,727 | 632,476 | ||
Accumulated other comprehensive loss | (197,523) | (171,158) | (191,148) | ||
Total shareholders' equity | 1,498,431 | 1,491,486 | 1,459,786 | ||
Total liabilities and shareholders' equity | $ 14,362,201 | 14,113,324 | 13,953,144 | ||
Equity to assets | 10.43 % | 10.57 % | 10.46 % | ||
Tangible common equity to assets* | 7.95 % | 8.03 % | 7.88 % | ||
Book value per share | $ 11.79 | 11.74 | 11.50 | ||
Tangible book value per share* | $ 8.74 | 8.67 | 8.42 | ||
Closing market price per share | $ 10.23 | 13.98 | 13.51 | ||
Full time equivalent employees | 2,084 | 2,160 | 2,191 | ||
Number of banking offices | 142 | 150 | 150 | ||
* Excludes goodwill and other intangible assets (non-GAAP). See reconciliation of non-GAAP financial measures for additional information relating to these items. |
Northwest Bancshares, Inc. and SubsidiariesConsolidated Statements of Income (Unaudited)(dollars in thousands, except per share amounts) | |||||||||
Quarter ended | |||||||||
September 30, 2023 | June 30, 2023 | March 31, 2023 | December 31, 2022 | September 30, 2022 | |||||
Interest income: | |||||||||
Loans receivable | $ 140,667 | 132,724 | 123,745 | 117,137 | 106,943 | ||||
Mortgage-backed securities | 8,072 | 8,326 | 8,537 | 8,603 | 8,683 | ||||
Taxable investment securities | 786 | 841 | 845 | 840 | 838 | ||||
Tax-free investment securities | 491 | 667 | 700 | 701 | 709 | ||||
FHLB stock dividends | 668 | 844 | 690 | 419 | 148 | ||||
Interest-earning deposits | 914 | 594 | 423 | 153 | 1,295 | ||||
Total interest income | 151,598 | 143,996 | 134,940 | 127,853 | 118,616 | ||||
Interest expense: | |||||||||
Deposits | 31,688 | 21,817 | 11,238 | 3,871 | 3,157 | ||||
Borrowed funds | 11,542 | 13,630 | 11,238 | 6,938 | 2,710 | ||||
Total interest expense | 43,230 | 35,447 | 22,476 | 10,809 | 5,867 | ||||
Net interest income | 108,368 | 108,549 | 112,464 | 117,044 | 112,749 | ||||
Provision for credit losses - loans | 3,983 | 6,010 | 4,870 | 9,023 | 7,689 | ||||
Provision for credit losses - unfunded commitments (1) | (2,981) | 2,920 | 126 | 1,876 | 3,585 | ||||
Net interest income after provision for credit losses | 107,366 | 99,619 | 107,468 | 106,145 | 101,475 | ||||
Noninterest income: | |||||||||
Loss on sale of investments | — | (8,306) | — | (1) | (2) | ||||
Gain on sale of mortgage servicing rights | — | 8,305 | — | — | — | ||||
Gain on sale of SBA loans | 301 | 832 | 279 | — | — | ||||
Service charges and fees | 15,270 | 14,833 | 13,189 | 14,125 | 14,323 | ||||
Trust and other financial services income | 7,085 | 6,866 | 6,449 | 6,642 | 6,650 | ||||
Gain on real estate owned, net | 29 | 785 | 108 | 51 | 290 | ||||
Income from bank-owned life insurance | 4,561 | 1,304 | 1,269 | 1,663 | 1,475 | ||||
Mortgage banking income | 632 | 1,028 | 524 | 477 | 766 | ||||
Other operating income | 3,010 | 4,150 | 2,151 | 4,901 | 3,301 | ||||
Total noninterest income | 30,888 | 29,797 | 23,969 | 27,858 | 26,803 | ||||
Noninterest expense: | |||||||||
Compensation and employee benefits | 51,243 | 47,650 | 46,604 | 46,658 | 46,711 | ||||
Premises and occupancy costs | 7,052 | 7,579 | 7,471 | 7,370 | 7,171 | ||||
Office operations | 3,398 | 2,800 | 3,010 | 3,544 | 3,229 | ||||
Collections expense | 551 | 429 | 387 | 563 | 322 | ||||
Processing expenses | 14,672 | 14,648 | 14,350 | 13,585 | 13,416 | ||||
Marketing expenses | 2,379 | 2,856 | 2,892 | 2,773 | 2,147 | ||||
Federal deposit insurance premiums | 2,341 | 2,064 | 2,223 | 1,319 | 1,200 | ||||
Professional services | 3,002 | 3,804 | 4,758 | 5,434 | 3,363 | ||||
Amortization of intangible assets | 795 | 842 | 909 | 932 | 1,047 | ||||
Real estate owned expense | 141 | 83 | 181 | 53 | 61 | ||||
Merger, asset disposition and restructuring expense | — | 1,593 | 2,802 | 4,243 | — | ||||
Other expenses | 1,996 | 1,510 | 1,863 | 2,304 | 321 | ||||
Total noninterest expense | 87,570 | 85,858 | 87,450 | 88,778 | 78,988 | ||||
Income before income taxes | 50,684 | 43,558 | 43,987 | 45,225 | 49,290 | ||||
Income tax expense | 11,464 | 10,514 | 10,308 | 10,576 | 11,986 | ||||
Net income | $ 39,220 | 33,044 | 33,679 | 34,649 | 37,304 | ||||
Basic earnings per share | $ 0.31 | 0.26 | 0.27 | 0.27 | 0.29 | ||||
Diluted earnings per share | $ 0.31 | 0.26 | 0.26 | 0.27 | 0.29 | ||||
Annualized return on average equity | 10.27 % | 8.72 % | 9.11 % | 9.38 % | 9.84 % | ||||
Annualized return on average assets | 1.08 % | 0.93 % | 0.97 % | 0.98 % | 1.05 % | ||||
Annualized return on tangible common equity * | 14.00 % | 11.79 % | 12.15 % | 12.48 % | 13.84 % | ||||
Efficiency ratio | 62.88 % | 62.06 % | 64.10 % | 61.27 % | 56.60 % | ||||
Efficiency ratio, excluding certain items (1) ** | 62.31 % | 60.30 % | 61.38 % | 57.70 % | 55.85 % | ||||
Annualized noninterest expense to average assets | 2.42 % | 2.42 % | 2.51 % | 2.52 % | 2.23 % | ||||
Annualized noninterest expense to average assets, excluding certain items (1) ** | 2.39 % | 2.35 % | 2.40 % | 2.37 % | 2.20 % | ||||
(1) | Reclassified from other expenses for periods prior to March 31, 2023. Respective ratios updated for reclassification. |
* | Excludes goodwill and other intangible assets (non-GAAP). See reconciliation of non-GAAP financial measures for additional information relating to these items. |
** | Excludes amortization of intangible assets and merger, asset disposition and restructuring expenses (non-GAAP).See reconciliation of non-GAAP financial measures for additional information relating to these items. |
Northwest Bancshares, Inc. and SubsidiariesConsolidated Statements of Income (Unaudited)(dollars in thousands, except per share amounts) | |||
Nine months ended September 30, | |||
2023 | 2022 | ||
Interest income: | |||
Loans receivable | $ 397,136 | 290,691 | |
Mortgage-backed securities | 24,935 | 22,201 | |
Taxable investment securities | 2,472 | 2,230 | |
Tax-free investment securities | 1,858 | 2,066 | |
FHLB stock dividends | 2,202 | 311 | |
Interest-earning deposits | 1,931 | 3,446 | |
Total interest income | 430,534 | 320,945 | |
Interest expense: | |||
Deposits | 64,743 | 10,249 | |
Borrowed funds | 36,410 | 7,059 | |
Total interest expense | 101,153 | 17,308 | |
Net interest income | 329,381 | 303,637 | |
Provision for credit losses - loans | 14,863 | 8,837 | |
Provision for credit losses - unfunded commitments (1) | 65 | 8,577 | |
Net interest income after provision for credit losses | 314,453 | 286,223 | |
Noninterest income: | |||
Loss on sale of investments | (8,306) | (7) | |
Gain on sale of mortgage servicing rights | 8,305 | — | |
Gain on sale of SBA loans | 1,412 | — | |
Service charges and fees | 43,292 | 41,063 | |
Trust and other financial services income | 20,400 | 21,123 | |
Gain on real estate owned, net | 922 | 552 | |
Income from bank-owned life insurance | 7,134 | 5,466 | |
Mortgage banking income | 2,184 | 4,388 | |
Other operating income | 9,311 | 10,406 | |
Total noninterest income | 84,654 | 82,991 | |
Noninterest expense: | |||
Compensation and employee benefits | 145,497 | 141,701 | |
Premises and occupancy costs | 22,102 | 22,248 | |
Office operations | 9,208 | 9,774 | |
Collections expense | 1,367 | 1,245 | |
Processing expenses | 43,670 | 38,911 | |
Marketing expenses | 8,127 | 6,322 | |
Federal deposit insurance premiums | 6,628 | 3,459 | |
Professional services | 11,564 | 9,269 | |
Amortization of intangible assets | 2,546 | 3,345 | |
Real estate owned expense | 405 | 170 | |
Merger, asset disposition and restructuring expense | 4,395 | 1,374 | |
Other expenses | 5,369 | 2,929 | |
Total noninterest expense | 260,878 | 240,747 | |
Income before income taxes | 138,229 | 128,467 | |
Income tax expense | 32,286 | 29,450 | |
Net income | $ 105,943 | 99,017 | |
Basic earnings per share | $ 0.83 | 0.78 | |
Diluted earnings per share | $ 0.83 | 0.78 | |
Annualized return on average equity | 9.37 % | 8.61 % | |
Annualized return on average assets | 0.99 % | 0.93 % | |
Annualized return on tangible common equity * | 12.74 % | 12.38 % | |
Efficiency ratio | 63.01 % | 62.27 % | |
Efficiency ratio, excluding certain items (1) ** | 61.33 % | 61.05 % | |
Annualized noninterest expense to average assets | 2.45 % | 2.26 % | |
Annualized noninterest expense to average assets, excluding certain items (1) ** | 2.38 % | 2.22 % | |
(1) | Reclassified from other expenses for periods prior to March 31, 2023. Respective ratios updated for reclassification. |
* | Excludes goodwill and other intangible assets (non-GAAP). See reconciliation of non-GAAP financial measures for additional information relating to these items. |
** | Excludes amortization of intangible assets and merger, asset disposition and restructuring expenses (non-GAAP). See reconciliation of non-GAAP financial measures for additional information relating to these items. |
Northwest Bancshares, Inc. and SubsidiariesReconciliation of Non-GAAP Financial Measures (Unaudited) *(dollars in thousands, except per share amounts) | |||||||
Quarter ended September 30, | Nine months ended September 30, | ||||||
2023 | 2022 | 2023 | 2022 | ||||
Reconciliation of net income to adjusted net operating income: | |||||||
Net income (GAAP) | $ 39,220 | 37,304 | 105,943 | 99,017 | |||
Non-GAAP adjustments | |||||||
Add: merger, asset disposition and restructuring expense | — | — | 4,395 | 1,374 | |||
Less: tax benefit of merger, asset disposition and restructuring expense | — | — | (1,231) | (385) | |||
Adjusted net operating income (non-GAAP) | $ 39,220 | 37,304 | 109,107 | 100,006 | |||
Diluted earnings per share (GAAP) | $ 0.31 | 0.29 | 0.83 | 0.78 | |||
Diluted adjusted operating earnings per share (non-GAAP) | $ 0.31 | 0.29 | 0.86 | 0.79 | |||
Average equity | $ 1,515,287 | 1,503,626 | 1,511,428 | 1,536,706 | |||
Average assets | 14,379,323 | 14,052,919 | 14,249,857 | 14,243,277 | |||
Annualized return on average equity (GAAP) | 10.27 % | 9.84 % | 9.37 % | 8.61 % | |||
Annualized return on average assets (GAAP) | 1.08 % | 1.05 % | 0.99 % | 0.93 % | |||
Annualized return on average equity, excluding merger, asset disposition and restructuring expense, net of tax (non-GAAP) | 10.27 % | 9.84 % | 9.65 % | 8.70 % | |||
Annualized return on average assets, excluding merger, asset disposition and restructuring expense, net of tax (non-GAAP) | 1.08 % | 1.05 % | 1.02 % | 0.94 % | |||
The following non-GAAP financial measures used by the Company provide information useful to investors in understanding our operating performance and trends, and facilitate comparisons with the performance of our peers. The following table summarizes the non-GAAP financial measures derived from amounts reported in the Company's Consolidated Statements of Financial Condition. |
September 30,2023 | December 31,2022 | September 30,2022 | |||
Tangible common equity to assets | |||||
Total shareholders' equity | $ 1,498,431 | 1,491,486 | 1,459,786 | ||
Less: goodwill and intangible assets | (387,010) | (389,557) | (390,488) | ||
Tangible common equity | $ 1,111,421 | 1,101,929 | 1,069,298 | ||
Total assets | $ 14,362,201 | 14,113,324 | 13,953,144 | ||
Less: goodwill and intangible assets | (387,010) | (389,557) | (390,488) | ||
Tangible assets | $ 13,975,191 | 13,723,767 | 13,562,656 | ||
Tangible common equity to tangible assets | 7.95 % | 8.03 % | 7.88 % | ||
Tangible common equity to tangible assets, including unrealized losses on held-to-maturityinvestments | |||||
Tangible common equity | $ 1,111,421 | 1,101,929 | 1,069,298 | ||
Less: unrealized losses on held to maturity investments | (147,425) | (129,865) | (128,174) | ||
Add: deferred taxes on unrealized losses on held to maturity investments | 41,279 | 36,362 | 35,889 | ||
Tangible common equity, including unrealized losses on held-to-maturity investments | $ 1,005,275 | 1,008,426 | 977,013 | ||
Tangible assets | 13,975,191 | 13,723,767 | 13,562,656 | ||
Tangible common equity to tangible assets, including unrealized losses on held-to-maturity investments | 7.19 % | 7.35 % | 7.20 % | ||
Tangible book value per share | |||||
Tangible common equity | $ 1,111,421 | 1,101,929 | 1,069,298 | ||
Common shares outstanding | 127,101,349 | 127,028,848 | 126,921,989 | ||
Tangible book value per share | 8.74 | 8.67 | 8.42 |
Northwest Bancshares, Inc. and SubsidiariesReconciliation of Non-GAAP Financial Measures (Unaudited) *(dollars in thousands, except per share amounts) | |||||||||||||
The following table summarizes the non-GAAP financial measures derived from amounts reported in the Company's Consolidated Statements of Income. | |||||||||||||
Quarter ended | Nine months ended September 30, | ||||||||||||
September 30,2023 | June 30,2023 | March 31,2023 | December 31,2022 | September 30,2022 | 2023 | 2022 | |||||||
Annualized return on tangible common equity | |||||||||||||
Net income | $ 39,220 | 33,044 | 33,679 | 34,649 | 37,304 | 105,943 | 99,017 | ||||||
Total shareholders' equity | 1,498,431 | 1,511,501 | 1,513,275 | 1,491,486 | 1,459,786 | 1,498,431 | 1,459,786 | ||||||
Less: goodwill and intangible assets | (387,010) | (387,806) | (388,648) | (389,557) | (390,488) | (387,010) | (390,488) | ||||||
Tangible common equity | $ 1,111,421 | 1,123,695 | 1,124,627 | 1,101,929 | 1,069,298 | 1,111,421 | 1,069,298 | ||||||
Annualized return on tangible common equity | 14.00 % | 11.79 % | 12.15 % | 12.48 % | 13.84 % | 12.74 % | 12.38 % | ||||||
Efficiency ratio, excluding amortization and merger, asset disposition and restructuring expenses | |||||||||||||
Non-interest expense | $ 87,570 | 85,858 | 87,450 | 88,778 | 78,988 | 260,878 | 240,747 | ||||||
Less: amortization expense | (795) | (842) | (909) | (932) | (1,047) | (2,546) | (3,345) | ||||||
Less: merger, asset disposition and restructuring expenses | — | (1,593) | (2,802) | (4,243) | — | (4,395) | (1,374) | ||||||
Non-interest expense, excluding amortization and merger, assets disposition andrestructuring expenses | $ 86,775 | 83,423 | 83,739 | 83,603 | 77,941 | 253,937 | 236,028 | ||||||
Net interest income | $ 108,368 | 108,549 | 112,464 | 117,044 | 112,749 | 329,381 | 303,637 | ||||||
Non-interest income | 30,888 | 29,797 | 23,969 | 27,858 | 26,803 | 84,654 | 82,991 | ||||||
Net interest income plus non-interest income | $ 139,256 | 138,346 | 136,433 | 144,902 | 139,552 | 414,035 | 386,628 | ||||||
Efficiency ratio, excluding amortization and merger, asset disposition and restructuring expenses | 62.31 % | 60.30 % | 61.38 % | 57.70 % | 55.85 % | 61.33 % | 61.05 % | ||||||
Annualized non-interest expense to average assets, excluding amortization andmerger, asset disposition and restructuring expense | |||||||||||||
Non-interest expense excluding amortization and merger, asset disposition and restructuring expenses | 86,775 | 83,423 | 83,739 | 83,603 | 77,941 | 253,937 | 236,028 | ||||||
Average assets | 14,379,323 | 14,245,917 | 14,121,496 | 13,983,100 | 14,052,919 | 14,249,857 | 14,243,277 | ||||||
Annualized non-interest expense to average assets, excluding amortization and merger, asset disposition and restructuring expense | 2.39 % | 2.35 % | 2.40 % | 2.37 % | 2.20 % | 2.38 % | 2.22 % | ||||||
* | The table summarizes the Company's results from operations on a GAAP basis and on an operating (non-GAAP) basis for the periods indicated. Operating results exclude merger, asset disposition and restructuring expense. The net tax effect was calculated using statutory tax rates of approximately 28.0%. The Company believes this non-GAAP presentation provides a meaningful comparison of operational performance and facilitates a more effective evaluation and comparison of results to assess performance in relation to ongoing operations. |
Northwest Bancshares, Inc. and SubsidiariesDeposits (Unaudited)(dollars in thousands) | |||||
Generally, deposits in excess of $250,000 are not federally insured. The following table provides details regarding the Company's uninsured deposits portfolio: | |||||
As of September 30, 2023 | |||||
Balance | Percent of total deposits | Number of relationships | |||
Uninsured deposits per the Call Report (1) | $ 2,868,596 | 25.10 % | 4,943 | ||
Less intercompany deposit accounts | 922,235 | 7.82 % | 13 | ||
Less collateralized deposit accounts | 524,715 | 4.45 % | 274 | ||
Adjusted balance of uninsured deposits | $ 1,421,646 | 12.06 % | 4,656 | ||
(1) | Uninsured deposits presented may be different from actual amounts due to titling of accounts. |
Our largest uninsured depositor, excluding intercompany and collateralized deposit accounts, had an aggregate uninsured deposit balance of $25.8 million, or 0.22% of total deposits, as of September 30, 2023. Our top ten largest uninsured depositors, excluding intercompany and collateralized deposit accounts, had an aggregate uninsured deposit balance of $117.0 million, or 0.99% of total deposits, as of September 30, 2023. The average adjusted uninsured deposit account balance was $305,000 as of September 30, 2023. |
The following table provides additional details over the Company's deposit portfolio: | |||||
As of September 30, 2023 | |||||
Balance | Percent of total deposits | Number of accounts | |||
Personal noninterest bearing demand deposits | $ 1,375,144 | 11.66 % | 290,763 | ||
Business noninterest bearing demand deposits | 1,399,147 | 11.87 | 45,435 | ||
Personal interest-bearing demand deposits | 1,477,617 | 12.53 | 59,309 | ||
Business interest-bearing demand deposits | 1,120,463 | 9.50 | 8,110 | ||
Personal money market deposits | 1,463,689 | 12.42 | 25,884 | ||
Business money market deposits | 579,124 | 4.91 | 2,916 | ||
Savings deposits | 2,116,360 | 17.95 | 210,196 | ||
Time deposits | 2,258,338 | 19.16 | 70,762 | ||
Total deposits | $ 11,789,882 | 100.00 % | 713,375 | ||
Our average deposit account balance as of September 30, 2023 was $16,500. The Company's insured cash sweep deposit balance was $265.3 million as of September 30, 2023. |
The following table provides additional details regarding the Company's deposit portfolio over time: | |||||||||||||
3/31/2022 | 6/30/2022 | 9/30/2022 | 12/31/2022 | 3/31/2023 | 6/30/2023 | 9/30/2023 | |||||||
Personal noninterest bearing demand deposits | $ 1,413,732 | 1,388,690 | 1,413,781 | 1,412,227 | 1,428,232 | 1,397,167 | 1,375,144 | ||||||
Business noninterest bearing demand deposits | 1,715,117 | 1,669,559 | 1,680,339 | 1,581,016 | 1,467,860 | 1,423,396 | 1,399,147 | ||||||
Personal interest-bearing demand deposits | 1,787,295 | 1,785,761 | 1,742,173 | 1,718,806 | 1,627,546 | 1,535,254 | 1,477,617 | ||||||
Business interest-bearing demand deposits | 588,850 | 529,357 | 498,937 | 499,059 | 466,105 | 624,252 | 689,914 | ||||||
Municipal demand deposits | 515,477 | 543,573 | 571,620 | 468,566 | 447,852 | 418,147 | 430,549 | ||||||
Personal money market deposits | 1,999,564 | 1,994,907 | 1,949,379 | 1,832,583 | 1,626,614 | 1,511,652 | 1,463,689 | ||||||
Business money market deposits | 681,049 | 636,805 | 627,634 | 624,986 | 701,436 | 642,601 | 579,124 | ||||||
Savings deposits | 2,367,438 | 2,362,725 | 2,327,419 | 2,275,020 | 2,194,743 | 2,120,215 | 2,116,360 | ||||||
Time deposits | 1,251,878 | 1,155,878 | 1,067,110 | 1,052,285 | 1,576,791 | 1,989,711 | 2,258,338 | ||||||
Total deposits | $ 12,320,400 | 12,067,255 | 11,878,392 | 11,464,548 | 11,537,179 | 11,662,395 | 11,789,882 | ||||||
Northwest Bancshares, Inc. and SubsidiariesMarketable Securities (Unaudited)(dollars in thousands) | ||||||||||
September 30, 2023 | ||||||||||
Marketable securities available-for-sale | Amortized cost | Gross unrealized holding gains | Gross unrealized holding losses | Fair value | Weighted average duration | |||||
Debt issued by the U.S. government and agencies: | ||||||||||
Due after one year through five years | $ 20,000 | — | (1,750) | 18,250 | 3.12 | |||||
Due after ten years | 50,166 | — | (11,890) | 38,276 | 6.20 | |||||
Debt issued by government sponsored enterprises: | ||||||||||
Due after one year through five years | 45,985 | — | (7,502) | 38,483 | 4.58 | |||||
Due after five years through ten years | 434 | — | (11) | 423 | 1.94 | |||||
Municipal securities: | ||||||||||
Due after one year through five years | 954 | 3 | (9) | 948 | 3.64 | |||||
Due after five years through ten years | 21,976 | — | (3,055) | 18,921 | 7.05 | |||||
Due after ten years | 62,990 | — | (14,788) | 48,202 | 10.76 | |||||
Corporate debt issues: | ||||||||||
Due after five years through ten years | 8,464 | — | (1,000) | 7,464 | 5.49 | |||||
Residential mortgage-backed agency securities: | ||||||||||
Fixed rate pass-through | 213,849 | — | (35,305) | 178,544 | 6.17 | |||||
Variable rate pass-through | 7,501 | 2 | (169) | 7,334 | 4.01 | |||||
Fixed rate agency CMOs | 805,086 | — | (175,985) | 629,101 | 4.88 | |||||
Variable rate agency CMOs | 24,675 | 28 | (573) | 24,130 | 3.37 | |||||
Total residential mortgage-backed agency securities | 1,051,111 | 30 | (212,032) | 839,109 | 5.10 | |||||
Total marketable securities available-for-sale | $ 1,262,080 | 33 | (252,037) | 1,010,076 | 5.40 | |||||
Marketable securities held-to-maturity | ||||||||||
Government sponsored | ||||||||||
Due after one year through five years | $ 49,471 | — | (6,830) | 42,641 | 3.75 | |||||
Due after five years through ten years | 74,986 | — | (14,901) | 60,085 | 5.43 | |||||
Residential mortgage-backed agency securities: | ||||||||||
Fixed rate pass-through | 151,411 | — | (27,070) | 124,341 | 5.18 | |||||
Variable rate pass-through | 468 | — | (8) | 460 | 3.48 | |||||
Fixed rate agency CMOs | 553,241 | — | (98,606) | 454,635 | 5.85 | |||||
Variable rate agency CMOs | 529 | — | (10) | 519 | 5.40 | |||||
Total residential mortgage-backed agency securities | 705,649 | — | (125,694) | 579,955 | 5.71 | |||||
Total marketable securities held-to-maturity | $ 830,106 | — | (147,425) | 682,681 | 5.56 | |||||
Northwest Bancshares, Inc. and SubsidiariesBorrowed Funds (Unaudited)(dollars in thousands) | |||
September 30, 2023 | |||
Amount | Average rate | ||
Term notes payable to the FHLB of Pittsburgh, due within one year | $ 375,400 | 5.65 % | |
Notes payable to the FHLB of Pittsburgh, due within one year | 119,000 | 5.68 % | |
Total term notes payable to the FHLB | 494,400 | 5.65 % | |
Collateralized borrowings, due within one year | 48,587 | 1.52 % | |
Collateral received, due within one year | 61,600 | 5.16 % | |
Subordinated debentures, net of issuance costs | 114,102 | 4.28 % | |
Junior subordinated debentures | 129,509 | 7.50 % | |
Total borrowed funds * | $ 848,198 | 5.48 % | |
* | As of September 30, 2023, the Company had $3.1 billion of additional borrowing capacity available with the FHLB of Pittsburgh, including a $250.0 million overnight line of credit, which had a $119.0 million drawn balance, as well as $302.0 million of borrowing capacity available with the Federal Reserve Bank and $105.0 million with two correspondent banks. |
Northwest Bancshares, Inc. and SubsidiariesAnalysis of Loan Portfolio by Loan Sector (Unaudited) | ||
Commercial real estate loans outstanding | ||
The following table provides the various loan sectors in our commercial real estate portfolio at September 30, 2023: | ||
September 30, 2023 | ||
Property type | Percent of portfolio | |
5 or more unit dwelling | 14.3 % | |
Nursing home | 12.8 | |
Retail building | 11.7 | |
Commercial office building - non-owner occupied | 8.4 | |
Residential acquisition & development - 1-4 family, townhouses and apartments | 5.0 | |
Warehouse/storage building | 4.0 | |
Manufacturing & industrial building | 3.4 | |
Commercial acquisition and development | 3.4 | |
Commercial office building - owner occupied | 3.3 | |
Multi-use building - office and warehouse | 3.3 | |
Hotel/motel | 2.9 | |
Single family dwelling | 2.8 | |
Other medical facility | 2.7 | |
Student housing | 2.6 | |
Multi-use building - commercial, retail and residential | 2.6 | |
2-4 family | 2.3 | |
Agricultural real estate | 2.1 | |
All other | 12.4 | |
Total | 100.0 % | |
The following table describes our commercial real estate portfolio by state at September 30, 2023: | ||
September 30, 2023 | ||
State | Percent of portfolio | |
Pennsylvania | 31.9 % | |
New York | 31.7 | |
Ohio | 20.4 | |
Indiana | 8.5 | |
All other | 7.5 | |
Total | 100.0 % | |
Northwest Bancshares, Inc. and SubsidiariesAsset Quality (Unaudited)(dollars in thousands) | |||||||||
September 30,2023 | June 30,2023 | March 31,2023 | December 31,2022 | September 30,2022 | |||||
Nonaccrual loans current: | |||||||||
Residential mortgage loans | $ 1,951 | 1,559 | 1,423 | 1,496 | 2,186 | ||||
Home equity loans | 947 | 1,089 | 1,084 | 1,418 | 1,158 | ||||
Consumer loans | 1,049 | 1,009 | 911 | 836 | 833 | ||||
Commercial real estate loans | 44,639 | 48,468 | 50,045 | 53,303 | 56,193 | ||||
Commercial loans | 1,369 | 995 | 1,468 | 895 | 1,801 | ||||
Total nonaccrual loans current | $ 49,955 | 53,120 | 54,931 | 57,948 | 62,171 | ||||
Nonaccrual loans delinquent 30 days to 59 days: | |||||||||
Residential mortgage loans | $ 48 | 49 | 688 | 473 | 54 | ||||
Home equity loans | 92 | 37 | 18 | 180 | 316 | ||||
Consumer loans | 274 | 309 | 223 | 178 | 155 | ||||
Commercial real estate loans | 1,913 | 1,697 | 1,900 | 1,220 | 55 | ||||
Commercial loans | 90 | 855 | 341 | 145 | 237 | ||||
Total nonaccrual loans delinquent 30 days to 59 days | $ 2,417 | 2,947 | 3,170 | 2,196 | 817 | ||||
Nonaccrual loans delinquent 60 days to 89 days: | |||||||||
Residential mortgage loans | $ 66 | 185 | 919 | 31 | 32 | ||||
Home equity loans | 319 | 363 | 338 | 290 | 432 | ||||
Consumer loans | 312 | 360 | 340 | 341 | 382 | ||||
Commercial real estate loans | 212 | 210 | 1,355 | 473 | 848 | ||||
Commercial loans | 291 | 245 | 126 | 96 | 132 | ||||
Total nonaccrual loans delinquent 60 days to 89 days | $ 1,200 | 1,363 | 3,078 | 1,231 | 1,826 | ||||
Nonaccrual loans delinquent 90 days or more: | |||||||||
Residential mortgage loans | $ 7,695 | 6,290 | 3,300 | 5,574 | 5,544 | ||||
Home equity loans | 2,073 | 1,965 | 2,190 | 2,257 | 1,779 | ||||
Consumer loans | 2,463 | 2,033 | 2,791 | 2,672 | 2,031 | ||||
Commercial real estate loans | 8,416 | 8,575 | 8,010 | 7,867 | 8,821 | ||||
Commercial loans | 2,435 | 2,296 | 1,139 | 1,491 | 638 | ||||
Total nonaccrual loans delinquent 90 days or more | $ 23,082 | 21,159 | 17,430 | 19,861 | 18,813 | ||||
Total nonaccrual loans | $ 76,654 | 78,589 | 78,609 | 81,236 | 83,627 | ||||
Total nonaccrual loans | $ 76,654 | 78,589 | 78,609 | 81,236 | 83,627 | ||||
Loans 90 days past due and still accruing | 728 | 532 | 652 | 744 | 357 | ||||
Nonperforming loans | 77,382 | 79,121 | 79,261 | 81,980 | 83,984 | ||||
Real estate owned, net | 363 | 371 | 524 | 413 | 450 | ||||
Nonperforming assets | $ 77,745 | 79,492 | 79,785 | 82,393 | 84,434 | ||||
Nonperforming loans to total loans | 0.68 % | 0.70 % | 0.71 % | 0.75 % | 0.78 % | ||||
Nonperforming assets to total assets | 0.54 % | 0.56 % | 0.56 % | 0.58 % | 0.61 % | ||||
Allowance for credit losses to total loans | 1.10 % | 1.10 % | 1.09 % | 1.08 % | 1.02 % | ||||
Allowance for total loans excluding PPP loan balances | 1.10 % | 1.10 % | 1.09 % | 1.08 % | 1.02 % | ||||
Allowance for credit losses to nonperforming loans | 161.33 % | 157.26 % | 152.98 % | 143.98 % | 130.76 % | ||||
Northwest Bancshares, Inc. and SubsidiariesLoans by Credit Quality Indicators (Unaudited)(dollars in thousands) | ||||||||||||
At September 30, 2023 | Pass | Special mention * | Substandard ** | Doubtful | Loss | Loans receivable | ||||||
Personal Banking: | ||||||||||||
Residential mortgage loans | $ 3,459,251 | — | 13,512 | — | — | 3,472,763 | ||||||
Home equity loans | 1,254,985 | — | 3,780 | — | — | 1,258,765 | ||||||
Consumer loans | 2,150,464 | — | 4,655 | — | — | 2,155,119 | ||||||
Total Personal Banking | 6,864,700 | — | 21,947 | — | — | 6,886,647 | ||||||
Commercial Banking: | ||||||||||||
Commercial real estate loans | 2,632,472 | 123,935 | 166,610 | — | — | 2,923,017 | ||||||
Commercial loans | 1,476,833 | 3,690 | 20,086 | — | — | 1,500,609 | ||||||
Total Commercial Banking | 4,109,305 | 127,625 | 186,696 | — | — | 4,423,626 | ||||||
Total loans | $ 10,974,005 | 127,625 | 208,643 | — | — | 11,310,273 | ||||||
At June 30, 2023 | ||||||||||||
Personal Banking: | ||||||||||||
Residential mortgage loans | $ 3,483,098 | — | 12,059 | — | — | 3,495,157 | ||||||
Home equity loans | 1,272,363 | — | 3,699 | — | — | 1,276,062 | ||||||
Consumer loans | 2,196,938 | — | 4,124 | — | — | 2,201,062 | ||||||
Total Personal Banking | 6,952,399 | — | 19,882 | — | — | 6,972,281 | ||||||
Commercial Banking: | ||||||||||||
Commercial real estate loans | 2,649,535 | 74,170 | 171,519 | — | — | 2,895,224 | ||||||
Commercial loans | 1,377,981 | 3,040 | 22,705 | — | — | 1,403,726 | ||||||
Total Commercial Banking | 4,027,516 | 77,210 | 194,224 | — | — | 4,298,950 | ||||||
Total loans | $ 10,979,915 | 77,210 | 214,106 | — | — | 11,271,231 | ||||||
At March 31, 2023 | ||||||||||||
Personal Banking: | ||||||||||||
Residential mortgage loans | $ 3,499,135 | — | 6,330 | — | — | 3,505,465 | ||||||
Home equity loans | 1,277,915 | — | 3,631 | — | — | 1,281,546 | ||||||
Consumer loans | 2,227,379 | — | 4,754 | — | — | 2,232,133 | ||||||
Total Personal Banking | 7,004,429 | — | 14,715 | — | — | 7,019,144 | ||||||
Commercial Banking: | ||||||||||||
Commercial real estate loans | 2,585,676 | 69,837 | 171,591 | — | — | 2,827,104 | ||||||
Commercial loans | 1,217,344 | 6,381 | 22,298 | — | — | 1,246,023 | ||||||
Total Commercial Banking | 3,803,020 | 76,218 | 193,889 | — | — | 4,073,127 | ||||||
Total loans | $ 10,807,449 | 76,218 | 208,604 | — | — | 11,092,271 | ||||||
At December 31, 2022 | ||||||||||||
Personal Banking: | ||||||||||||
Residential mortgage loans | $ 3,484,870 | — | 13,729 | — | — | 3,498,599 | ||||||
Home equity loans | 1,292,146 | — | 5,528 | — | — | 1,297,674 | ||||||
Consumer loans | 2,164,220 | — | 4,435 | — | — | 2,168,655 | ||||||
Total Personal Banking | 6,941,236 | — | 23,692 | — | — | 6,964,928 | ||||||
Commercial Banking: | ||||||||||||
Commercial real estate loans | 2,579,809 | 55,076 | 188,670 | — | — | 2,823,555 | ||||||
Commercial loans | 1,100,707 | 7,384 | 23,878 | — | — | 1,131,969 | ||||||
Total Commercial Banking | 3,680,516 | 62,460 | 212,548 | — | — | 3,955,524 | ||||||
Total loans | $ 10,621,752 | 62,460 | 236,240 | — | — | 10,920,452 | ||||||
At September 30, 2022 | ||||||||||||
Personal Banking: | ||||||||||||
Residential mortgage loans | $ 3,388,168 | — | 13,730 | — | — | 3,401,898 | ||||||
Home equity loans | 1,279,968 | — | 5,021 | — | — | 1,284,989 | ||||||
Consumer loans | 2,112,478 | — | 3,760 | — | — | 2,116,238 | ||||||
Total Personal Banking | 6,780,614 | — | 22,511 | — | — | 6,803,125 | ||||||
Commercial Banking: | ||||||||||||
Commercial real estate loans | 2,589,648 | 34,684 | 188,498 | — | — | 2,812,830 | ||||||
Commercial loans | 1,094,830 | 4,004 | 26,736 | — | — | 1,125,570 | ||||||
Total Commercial Banking | 3,684,478 | 38,688 | 215,234 | — | — | 3,938,400 | ||||||
Total loans | $ 10,465,092 | 38,688 | 237,745 | — | — | 10,741,525 | ||||||
* | Includes $6.9 million, $4.9 million, $7.4 million, $7.4 million, and $4.5 million of acquired loans at September 30, 2023, June 30, 2023, March 31, 2023, December 31, 2022, and September 30, 2022, respectively. |
** | Includes $28.9 million, $31.2 million, $31.9 million, $39.1 million, and $51.4 million of acquired loans at September 30, 2023, June 30, 2023, March 31, 2023, December 31, 2022, and September 30, 2022, respectively. |
Northwest Bancshares, Inc. and SubsidiariesLoan Delinquency (Unaudited)(dollars in thousands) | |||||||||||||||||||||||||||||
September 30,2023 | * | June 30,2023 | * | March 31,2023 | * | December 31,2022 | * | September 30,2022 | * | ||||||||||||||||||||
(Number of loans and dollar amount of loans) | |||||||||||||||||||||||||||||
Loans delinquent 30 days to 59 days: | |||||||||||||||||||||||||||||
Residential mortgage loans | 6 | $ 573 | — % | 14 | $ 627 | — % | 259 | $ 26,992 | 0.8 % | 304 | $ 29,487 | 0.8 % | 26 | $ 1,052 | — % | ||||||||||||||
Home equity loans | 112 | 4,707 | 0.4 % | 92 | 3,395 | 0.3 % | 111 | 4,235 | 0.3 % | 145 | 6,657 | 0.5 % | 88 | 3,278 | 0.3 % | ||||||||||||||
Consumer loans | 733 | 9,874 | 0.5 % | 602 | 7,955 | 0.4 % | 587 | 6,930 | 0.3 % | 737 | 9,435 | 0.4 % | 549 | 6,546 | 0.3 % | ||||||||||||||
Commercial real estate loans | 22 | 3,411 | 0.1 % | 13 | 2,710 | 0.1 % | 23 | 4,834 | 0.2 % | 29 | 4,008 | 0.1 % | 13 | 1,332 | — % | ||||||||||||||
Commercial loans | 52 | 2,847 | 0.2 % | 38 | 15,658 | 1.1 % | 46 | 4,253 | 0.3 % | 51 | 2,648 | 0.2 % | 48 | 2,582 | 0.2 % | ||||||||||||||
Total loans delinquent 30 days to 59 days | 925 | $ 21,412 | 0.2 % | 759 | $ 30,345 | 0.3 % | 1,026 | $ 47,244 | 0.4 % | 1,266 | $ 52,235 | 0.5 % | 724 | $ 14,790 | 0.1 % | ||||||||||||||
Loans delinquent 60 days to 89 days: | |||||||||||||||||||||||||||||
Residential mortgage loans | 56 | $ 5,395 | 0.2 % | 52 | $ 3,521 | 0.1 % | 23 | $ 1,922 | 0.1 % | 65 | $ 5,563 | 0.2 % | 51 | $ 4,320 | 0.1 % | ||||||||||||||
Home equity loans | 40 | 1,341 | 0.1 % | 31 | 1,614 | 0.1 % | 31 | 1,061 | 0.1 % | 29 | 975 | 0.1 % | 36 | 1,227 | 0.1 % | ||||||||||||||
Consumer loans | 236 | 2,707 | 0.1 % | 250 | 2,584 | 0.1 % | 185 | 2,083 | 0.1 % | 255 | 3,070 | 0.1 % | 223 | 2,663 | 0.1 % | ||||||||||||||
Commercial real estate loans | 13 | 1,588 | 0.1 % | 12 | 1,288 | — % | 17 | 1,949 | 0.1 % | 16 | 2,377 | 0.1 % | 13 | 1,741 | 0.1 % | ||||||||||||||
Commercial loans | 15 | 981 | 0.1 % | 23 | 11,092 | 0.8 % | 19 | 1,088 | 0.1 % | 24 | 1,115 | 0.1 % | 14 | 808 | 0.1 % | ||||||||||||||
Total loans delinquent 60 days to 89 days | 360 | $ 12,012 | 0.1 % | 368 | $ 20,099 | 0.2 % | 275 | $ 8,103 | 0.1 % | 389 | $ 13,100 | 0.1 % | 337 | $ 10,759 | 0.1 % | ||||||||||||||
Loans delinquent 90 days or more: ** | |||||||||||||||||||||||||||||
Residential mortgage loans | 79 | $ 7,695 | 0.2 % | 63 | $ 6,290 | 0.2 % | 39 | $ 3,300 | 0.1 % | 65 | $ 5,574 | 0.2 % | 64 | $ 5,544 | 0.2 % | ||||||||||||||
Home equity loans | 73 | 2,206 | 0.2 % | 68 | 1,965 | 0.2 % | 65 | 2,190 | 0.2 % | 68 | 2,257 | 0.2 % | 65 | 1,779 | 0.1 % | ||||||||||||||
Consumer loans | 357 | 3,020 | 0.1 % | 314 | 2,447 | 0.1 % | 313 | 3,279 | 0.1 % | 334 | 3,079 | 0.1 % | 289 | 2,388 | 0.1 % | ||||||||||||||
Commercial real estate loans | 27 | 8,416 | 0.3 % | 20 | 8,575 | 0.3 % | 18 | 8,010 | 0.3 % | 19 | 7,867 | 0.3 % | 22 | 8,821 | 0.3 % | ||||||||||||||
Commercial loans | 39 | 2,472 | 0.2 % | 38 | 2,414 | 0.2 % | 24 | 1,302 | 0.1 % | 15 | 1,829 | 0.2 % | 11 | 638 | 0.1 % | ||||||||||||||
Total loans delinquent 90 days or more | 575 | $ 23,809 | 0.2 % | 503 | $ 21,691 | 0.2 % | 459 | $ 18,081 | 0.2 % | 501 | $ 20,606 | 0.2 % | 451 | $ 19,170 | 0.2 % | ||||||||||||||
Total loans delinquent | 1,860 | $ 57,233 | 0.5 % | 1,630 | $ 72,135 | 0.6 % | 1,760 | $ 73,428 | 0.7 % | 2,156 | $ 85,941 | 0.8 % | 1,512 | $ 44,719 | 0.4 % | ||||||||||||||
* | Represents delinquency, in dollars, divided by the respective total amount of that type of loan outstanding. |
** | Includes purchased credit deteriorated loans of $1.4 million, $605,000, $331,000, $1.7 million, and $783,000 at September 30, 2023, June 30, 2023, March 31, 2023, December 31, 2022, and September 30, 2022, respectively. |
Northwest Bancshares, Inc. and SubsidiariesAllowance for Credit Losses (Unaudited)(dollars in thousands) | |||||||||
Quarter ended | |||||||||
September 30,2023 | June 30,2023 | March 31,2023 | December 31,2022 | September 30,2022 | |||||
Beginning balance | $ 124,423 | 121,257 | 118,036 | 109,819 | 98,355 | ||||
ASU 2022-02 Adoption | — | — | 426 | — | — | ||||
Provision | 3,983 | 6,010 | 4,870 | 9,023 | 7,689 | ||||
Charge-offs residential mortgage | (171) | (545) | (207) | (546) | (166) | ||||
Charge-offs home equity | (320) | (235) | (164) | (232) | (535) | ||||
Charge-offs consumer | (3,085) | (2,772) | (2,734) | (2,430) | (2,341) | ||||
Charge-offs commercial real estate | (484) | (483) | (657) | (621) | (1,329) | ||||
Charge-offs commercial | (1,286) | (1,209) | (865) | (404) | (243) | ||||
Recoveries | 1,781 | 2,400 | 2,552 | 3,427 | 8,389 | ||||
Ending balance | $ 124,841 | 124,423 | 121,257 | 118,036 | 109,819 | ||||
Net charge-offs to average loans, annualized | 0.13 % | 0.10 % | 0.08 % | 0.03 % | (0.14) % | ||||
Nine months ended September 30, | |||
2023 | 2022 | ||
Beginning balance | $ 118,036 | 102,241 | |
ASU 2022-02 Adoption | 426 | — | |
Provision | 14,863 | 8,837 | |
Charge-offs residential mortgage | (923) | (1,487) | |
Charge-offs home equity | (719) | (1,237) | |
Charge-offs consumer | (8,591) | (5,976) | |
Charge-offs commercial real estate | (1,624) | (6,745) | |
Charge-offs commercial | (3,360) | (1,253) | |
Recoveries | 6,733 | 15,439 | |
Ending balance | $ 124,841 | 109,819 | |
Net charge-offs to average loans, annualized | 0.10 % | 0.02 % | |
Northwest Bancshares, Inc. and SubsidiariesAverage 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 forthe 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. Averagebalances are calculated using daily averages. | |||||||||||||||||||||||||||||
Quarter ended | |||||||||||||||||||||||||||||
September 30, 2023 | June 30, 2023 | March 31, 2023 | December 31, 2022 | September 30, 2022 | |||||||||||||||||||||||||
Averagebalance | Interest | Avg. yield/ cost (h) | Averagebalance | Interest | Avg.yield/cost (h) | Averagebalance | Interest | Avg.yield/cost (h) | Averagebalance | Interest | Avg.yield/cost (h) | Averagebalance | Interest | Avg.yield/cost (h) | |||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||||||||
Residential mortgage loans | $ 3,476,446 | 32,596 | 3.75 % | $ 3,485,517 | 32,485 | 3.73 % | $ 3,493,617 | 32,009 | 3.66 % | $ 3,439,401 | 30,974 | 3.60 % | $ 3,331,173 | 29,414 | 3.53 % | ||||||||||||||
Home equity loans | 1,264,134 | 17,435 | 5.47 % | 1,273,298 | 16,898 | 5.32 % | 1,284,425 | 16,134 | 5.09 % | 1,282,733 | 15,264 | 4.72 % | 1,274,918 | 13,658 | 4.25 % | ||||||||||||||
Consumer loans | 2,092,023 | 23,521 | 4.46 % | 2,143,804 | 22,662 | 4.24 % | 2,123,672 | 20,794 | 3.97 % | 2,069,207 | 19,709 | 3.78 % | 1,981,754 | 17,256 | 3.45 % | ||||||||||||||
Commercial real estate loans | 2,911,145 | 41,611 | 5.67 % | 2,836,443 | 38,426 | 5.43 % | 2,824,120 | 37,031 | 5.24 % | 2,822,008 | 35,428 | 4.91 % | 2,842,597 | 34,158 | 4.70 % | ||||||||||||||
Commercial loans | 1,447,211 | 26,239 | 7.19 % | 1,326,598 | 22,872 | 6.92 % | 1,161,298 | 18,353 | 6.32 % | 1,113,178 | 16,315 | 5.74 % | 1,050,124 | 12,978 | 4.84 % | ||||||||||||||
Total loans receivable (a) (b) (d) | 11,190,959 | 141,402 | 5.01 % | 11,065,660 | 133,343 | 4.83 % | 10,887,132 | 124,321 | 4.63 % | 10,726,527 | 117,690 | 4.35 % | 10,480,566 | 107,464 | 4.07 % | ||||||||||||||
Mortgage-backed securities (c) | 1,781,010 | 8,072 | 1.81 % | 1,859,427 | 8,326 | 1.79 % | 1,909,676 | 8,537 | 1.79 % | 1,956,167 | 8,603 | 1.76 % | 2,019,715 | 8,683 | 1.72 % | ||||||||||||||
Investment securities (c) (d) | 336,125 | 1,431 | 1.70 % | 374,560 | 1,715 | 1.83 % | 384,717 | 1,761 | 1.83 % | 386,468 | 1,753 | 1.81 % | 388,755 | 1,762 | 1.81 % | ||||||||||||||
FHLB stock, at cost | 37,722 | 668 | 7.03 % | 45,505 | 844 | 7.44 % | 39,631 | 690 | 7.06 % | 26,827 | 419 | 6.19 % | 14,028 | 148 | 4.19 % | ||||||||||||||
Other interest-earning deposits | 59,433 | 915 | 6.11 % | 38,912 | 594 | 6.12 % | 30,774 | 423 | 5.50 % | 9,990 | 153 | 5.99 % | 253,192 | 1,295 | 2.00 % | ||||||||||||||
Total interest-earning assets | 13,405,249 | 152,488 | 4.51 % | 13,384,064 | 144,822 | 4.34 % | 13,251,930 | 135,732 | 4.15 % | 13,105,979 | 128,618 | 3.89 % | 13,156,256 | 119,352 | 3.60 % | ||||||||||||||
Noninterest-earning assets (e) | 974,074 | 861,853 | 869,566 | 877,121 | 896,663 | ||||||||||||||||||||||||
Total assets | $ 14,379,323 | $ 14,245,917 | $ 14,121,496 | $ 13,983,100 | $ 14,052,919 | ||||||||||||||||||||||||
Liabilities and shareholders' equity: | |||||||||||||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||||||||
Savings deposits (g) | $ 2,116,759 | 2,695 | 0.51 % | $ 2,142,941 | 1,393 | 0.26 % | $ 2,198,988 | 690 | 0.13 % | $ 2,298,451 | 585 | 0.10 % | $ 2,350,248 | 594 | 0.10 % | ||||||||||||||
Interest-bearing demand deposits (g) | 2,569,229 | 4,086 | 0.63 % | 2,469,666 | 1,648 | 0.27 % | 2,612,883 | 951 | 0.15 % | 2,718,360 | 509 | 0.07 % | 2,794,338 | 360 | 0.05 % | ||||||||||||||
Money market deposit accounts (g) | 2,112,228 | 6,772 | 1.27 % | 2,221,713 | 6,113 | 1.10 % | 2,408,582 | 4,403 | 0.74 % | 2,512,892 | 1,310 | 0.21 % | 2,620,850 | 692 | 0.10 % | ||||||||||||||
Time deposits (g) | 2,164,559 | 18,136 | 3.32 % | 1,765,454 | 12,663 | 2.88 % | 1,293,609 | 5,194 | 1.63 % | 1,024,895 | 1,467 | 0.57 % | 1,110,906 | 1,511 | 0.54 % | ||||||||||||||
Borrowed funds (f) | 643,518 | 7,937 | 4.89 % | 837,358 | 10,202 | 4.89 % | 740,218 | 7,938 | 4.35 % | 451,369 | 3,967 | 3.49 % | 127,073 | 239 | 0.75 % | ||||||||||||||
Subordinated debt | 114,045 | 1,148 | 4.03 % | 113,958 | 1,148 | 4.03 % | 113,870 | 1,148 | 4.03 % | 113,783 | 1,148 | 4.04 % | 113,695 | 1,149 | 4.04 % | ||||||||||||||
Junior subordinated debentures | 129,466 | 2,456 | 7.42 % | 129,401 | 2,280 | 6.97 % | 129,335 | 2,152 | 6.66 % | 129,271 | 1,823 | 5.52 % | 129,207 | 1,322 | 4.00 % | ||||||||||||||
Total interest-bearing liabilities | 9,849,804 | 43,230 | 1.74 % | 9,680,491 | 35,447 | 1.47 % | 9,497,485 | 22,476 | 0.96 % | 9,249,021 | 10,809 | 0.46 % | 9,246,317 | 5,867 | 0.25 % | ||||||||||||||
Noninterest-bearing demand deposits (g) | 2,757,091 | 2,820,928 | 2,889,973 | 3,039,000 | 3,093,490 | ||||||||||||||||||||||||
Noninterest-bearing liabilities | 257,141 | 224,508 | 235,213 | 229,794 | 209,486 | ||||||||||||||||||||||||
Total liabilities | 12,864,036 | 12,725,927 | 12,622,671 | 12,517,815 | 12,549,293 | ||||||||||||||||||||||||
Shareholders' equity | 1,515,287 | 1,519,990 | 1,498,825 | 1,465,285 | 1,503,626 | ||||||||||||||||||||||||
Total liabilities and shareholders' equity | $ 14,379,323 | $ 14,245,917 | $ 14,121,496 | $ 13,983,100 | $ 14,052,919 | ||||||||||||||||||||||||
Net interest income/Interest rate spread | 109,258 | 2.77 % | 109,375 | 2.87 % | 113,256 | 3.19 % | 117,809 | 3.43 % | 113,485 | 3.35 % | |||||||||||||||||||
Net interest-earning assets/Net interest margin | $ 3,555,445 | 3.23 % | $ 3,703,573 | 3.28 % | $ 3,754,445 | 3.47 % | $ 3,856,958 | 3.57 % | $ 3,909,939 | 3.42 % | |||||||||||||||||||
Ratio of interest-earning assets to interest-bearing liabilities | 1.36X | 1.38X | 1.40X | 1.42X | 1.42X | ||||||||||||||||||||||||
(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 and collateralized borrowings. |
(g) | Average cost of deposits were 1.07%, 0.77%, 0.40%, 0.13%, and 0.11%, respectively and average cost of Interest-bearing deposits were 1.40%, 1.02%, 0.54%, 0.18%, and 0.14%, respectively. |
(h) | Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans — 4.99%, 4.81%, 4.61%, 4.33%, and 4.05%, respectively, Investment securities — 1.52%, 1.61%, 1.61%, 1.59%, and 1.59%, respectively, Interest-earning assets — 4.49%, 4.32%, 4.13%, 3.87%, and 3.58%, respectively. GAAP basis net interest rate spreads were 2.75%, 2.85%, 3.17%, 3.41%, and 3.33%, respectively, and GAAP basis net interest margins were 3.21%, 3.25%, 3.44%, 3.54%, and 3.40%, respectively. |
Northwest Bancshares, Inc. and SubsidiariesAverage Balance Sheet (Unaudited)(in thousands) | |||||||||||
The following table sets forth certain information relating to the Company's average balance sheet and reflects the averageyield on interest-earning assets and average cost of interest-bearing 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 balancesare calculated using daily averages. | |||||||||||
Nine months ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Averagebalance | Interest | Avg.yield/cost (h) | Averagebalance | Interest | Avg.yield/cost (h) | ||||||
Assets | |||||||||||
Interest-earning assets: | |||||||||||
Residential mortgage loans | $ 3,485,130 | 97,090 | 3.71 % | $ 3,162,758 | 82,282 | 3.47 % | |||||
Home equity loans | 1,273,878 | 50,467 | 5.30 % | 1,282,045 | 37,443 | 3.90 % | |||||
Consumer loans | 2,119,717 | 66,977 | 4.22 % | 1,887,843 | 47,588 | 3.37 % | |||||
Commercial real estate loans | 2,857,555 | 117,074 | 5.48 % | 2,918,940 | 95,813 | 4.33 % | |||||
Commercial loans | 1,312,750 | 67,465 | 6.87 % | 929,942 | 28,981 | 4.11 % | |||||
Loans receivable (a) (b) (d) | 11,049,030 | 399,073 | 4.83 % | 10,181,528 | 292,107 | 3.84 % | |||||
Mortgage-backed securities (c) | 1,849,567 | 24,935 | 1.80 % | 1,972,694 | 22,201 | 1.50 % | |||||
Investment securities (c) (d) | 364,956 | 4,909 | 1.79 % | 379,850 | 4,923 | 1.73 % | |||||
FHLB stock, at cost | 40,945 | 2,202 | 7.19 % | 13,776 | 311 | 3.02 % | |||||
Other interest-earning deposits | 64,560 | 1,931 | 4.00 % | 753,482 | 3,447 | 0.60 % | |||||
Total interest-earning assets | 13,369,058 | 433,050 | 4.33 % | 13,301,330 | 322,989 | 3.25 % | |||||
Noninterest-earning assets (e) | 880,799 | 941,947 | |||||||||
Total assets | $ 14,249,857 | $ 14,243,277 | |||||||||
Liabilities and shareholders' equity | |||||||||||
Interest-bearing liabilities: | |||||||||||
Savings deposits (g) | $ 2,163,564 | 4,777 | 0.30 % | $ 2,348,944 | 1,758 | 0.10 % | |||||
Interest-bearing demand deposits (g) | 2,550,433 | 6,684 | 0.35 % | 2,842,071 | 1,008 | 0.05 % | |||||
Money market deposit accounts (g) | 2,246,422 | 17,289 | 1.03 % | 2,647,301 | 2,067 | 0.10 % | |||||
Time deposits (g) | 1,733,428 | 35,993 | 2.78 % | 1,207,444 | 5,416 | 0.60 % | |||||
Borrowed funds (f) | 740,011 | 26,077 | 4.71 % | 131,368 | 563 | 0.57 % | |||||
Subordinated debt | 113,958 | 3,444 | 4.03 % | 118,919 | 3,603 | 4.04 % | |||||
Junior subordinated debentures | 129,401 | 6,889 | 7.02 % | 129,142 | 2,893 | 2.95 % | |||||
Total interest-bearing liabilities | 9,677,217 | 101,153 | 1.40 % | 9,425,189 | 17,308 | 0.25 % | |||||
Noninterest-bearing demand deposits (g) | 2,822,178 | 3,081,640 | |||||||||
Noninterest-bearing liabilities | 239,034 | 199,742 | |||||||||
Total liabilities | 12,738,429 | 12,706,571 | |||||||||
Shareholders' equity | 1,511,428 | 1,536,706 | |||||||||
Total liabilities and shareholders' equity | $ 14,249,857 | $ 14,243,277 | |||||||||
Net interest income/Interest rate spread | 331,897 | 2.93 % | 305,681 | 3.00 % | |||||||
Net interest-earning assets/Net interest margin | $ 3,691,841 | 3.32 % | $ 3,876,141 | 3.07 % | |||||||
Ratio of interest-earning assets to interest-bearing liabilities | 1.38X | 1.41X | |||||||||
(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 were 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 and collateralized borrowings. |
(g) | Average cost of deposits were 0.75% and 0.11%, respectively and average cost of Interest-bearing deposits were 1.00% and 0.15%, respectively. |
(h) | Shown on a FTE basis. GAAP basis yields were: Loans — 4.81% and 3.82%, respectively; Investment securities — 1.58% and 1.51%, respectively; Interest-earning assets — 4.31% and 3.23%, respectively. GAAP basis net interest rate spreads were 2.91% and 2.98%, respectively; and GAAP basis net interest margins were 3.29% and 3.05%, respectively. |
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SOURCE Northwest Bank; Northwest Bancshares, Inc.