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Northwest Bancshares, Inc. Announces Third Quarter 2022 Earnings and Quarterly Dividend

October, 24, 2022

COLUMBUS, Ohio, Oct. 24, 2022 /PRNewswire/ -- Northwest Bancshares, Inc., (the "Company"), (NasdaqGS: NWBI) announced net income for the quarter ended September 30, 2022 of $37.3 million, or $0.29 per diluted share.  This represents an increase of $2.2 million, or 6.4%, compared to the same quarter last year, when net income was $35.1 million, or $0.27 per diluted share.  The annualized returns on average shareholders' equity and average assets for the quarter ended September 30, 2022 were 9.84% and 1.05% compared to 8.86% and 0.97% for the quarter ended September 30, 2021. 

The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.20 per share payable on November 14, 2022 to shareholders of record as of November 3, 2022. This is the 112th 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, 2022, this represents an annualized dividend yield of approximately 5.9%. 

Louis J. Torchio, President and CEO, added, "We are very pleased with the positive results in the current quarter beginning with the expansion of our net interest margin by 35 basis points as a result of both an increase in market interest rates and the deployment of our remaining excess liquidity into higher yielding interest-earning assets. The loan growth momentum seen during the second quarter carried into the current quarter with the generation of organic loan growth of approximately $241.7 million, or 2.3%, augmented by the purchase of a $67.0 million small business equipment finance pool.  We are also pleased to report a continued favorable trend in expense management during the year with our efficiency ratio improving to 58.4% during the current quarter."

Mr. Torchio continued, "Asset quality metrics continue to improve with nonperforming and classified assets dropping to $84.4 million and $237.7 million, respectively.  However, due to a deterioration in economic forecasts, we recorded a provision for credit losses of $7.7 million for the quarter, which is more consistent with our historic averages.  Total delinquency continues to remain low at 0.4% of total loans and we experienced a total net recovery of $3.8 million in the current quarter primarily from the recovery of a previously charged-off commercial real estate loan."  

Net interest income increased by $14.3 million, or 14.6%, to $112.7 million for the quarter ended September 30, 2022, from $98.4 million for the quarter ended September 30, 2021.  This increase in net interest income is due to both the increase in market interest rates and the change in our interest-earning asset mix.  Interest-earning deposits were deployed into higher yielding loans and investments, which caused the yield on interest-earning assets to increase to 3.60% for the quarter ended September 30, 2022 from 3.15% for the quarter ended September 30, 2021.  The net effect of the changes in interest rates and average balances was an increase in the Company's net interest margin to 3.42% for the quarter ended September 30, 2022, from 2.97% for the same quarter last year.

The provision for credit losses increased by $12.0 million, or 276.6%, to $7.7 million for the quarter ended September 30, 2022 from a provision credit of $4.4 million for the quarter ended September 30, 2021.  This increase was primarily due  to growth within our loan portfolio during the current year in conjunction with forecasted economic deterioration reflected in our allowance for credit loss models.  The Company continued to experience improvement in asset quality as classified loans decreased by $146.6 million, or 38.1%, to $237.7 million, or 2.2% of total loans, at September 30, 2022, from $384.4 million, or 3.8% of total loans, at September 30, 2021.  Total delinquent loans also decreased to $44.7 million, or 0.4% of loans receivable, at September 30, 2022 from $64.0 million, or 0.6% of loans receivable, at September 30, 2021. In addition, the Company experienced a total net recovery during the current quarter of $3.8 million, or 0.14% on an annualized basis, compared to a net charge-off of $3.2 million, or 0.12% on an annualized basis, during the same quarter last year for an overall net improvement of $7.0 million. 

Noninterest income decreased by $2.4 million, or 8.2%, to $26.8 million for the quarter ended September 30, 2022, from $29.2 million for the quarter ended September 30, 2021.  This decrease was primarily due to a decline in our mortgage banking income of $3.2 million, or 80.6%, to $766,000 for the quarter ended September 30, 2022 from $3.9 million for the quarter ended September 30, 2021. This decrease reflects the impact of less favorable pricing in the secondary market, due primarily to the volatile interest rate environment, as well as decreased mortgage volumes. Partially offsetting this decrease was an increase in service charges and fee income of $1.1 million, or 8.5%, to $14.3 million for the quarter ended September 30, 2022 from $13.2 million for the quarter ended September 30, 2021 as customer activity increased in 2022 after COVID-19 restricted behavior in the prior year. 

Noninterest expense decreased by $3.5 million, or 4.1%, to $82.6 million for the quarter ended September 30, 2022 from $86.1 million for the quarter ended September 30, 2021. Almost all expense categories decreased as the Company continues to focus on controlling costs and improving efficiency. Contributing to the decrease was a $2.4 million, or 4.8%, decrease in compensation and employee benefits to $46.7 million for the quarter ended September 30, 2022 from $49.1 million for the quarter ended September 30, 2021 due to branch consolidations completed in April 2022.  Also contributing to this favorable variance was a $932,000, or 21.7%, decrease in professional services to $3.4 million for the quarter ended September 30, 2022 from $4.3 million for the quarter ended September 30, 2021 due to the increased use of third-party consulting services during the prior year.  Partially offsetting these decreases was an increase in other expenses of $1.7 million, or 75.4%, to $3.9 million for the quarter ended September 30, 2022 from $2.2 million for the quarter ended September 30, 2021 due to an increase in our unfunded loan loss reserve associated with the origination of loans with current off balance sheet exposure.  

The provision for income taxes increased by $1.2 million, or 11.0%, to $12.0 million for the quarter ended September 30, 2022 from $10.8 million for the quarter ended September 30, 2021 due primarily to an increase in income before taxes in the current year.

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 treasury management solutions and wealth management services. As of September 30, 2022, Northwest operated 142 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.

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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; and (8) 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 Subsidiaries
Consolidated Statements of Financial Condition (Unaudited)
(dollars in thousands, except per share amounts)



September 30,
2022


December 31,
2021


September 30,
2021

Assets






Cash and cash equivalents

$       118,549


1,279,259


1,090,485

Marketable securities available-for-sale (amortized cost of $1,466,883, $1,565,002 and $1,587,105,
respectively)

1,251,791


1,548,592


1,583,715

Marketable securities held-to-maturity (fair value of $771,238, $751,513 and $609,777, respectively)

899,411


768,154


618,395

Total cash and cash equivalents and marketable securities

2,269,751


3,596,005


3,292,595







Residential mortgage loans held-for-sale

15,834


25,056


27,411

Residential mortgage loans

3,386,064


2,969,564


2,962,110

Home equity loans

1,284,989


1,319,931


1,350,348

Consumer loans

2,116,238


1,838,748


1,816,836

Commercial real estate loans

2,812,830


3,015,484


3,162,551

Commercial loans

1,125,570


847,609


879,712

Total loans receivable

10,741,525


10,016,392


10,198,968

Allowance for credit losses

(109,819)


(102,241)


(109,767)

Loans receivable, net

10,631,706


9,914,151


10,089,201







FHLB stock, at cost

19,281


14,184


14,567

Accrued interest receivable

29,536


25,599


26,995

Real estate owned, net

450


873


809

Premises and equipment, net

146,173


156,524


155,740

Bank-owned life insurance

255,015


256,213


254,871

Goodwill

380,997


380,997


380,997

Other intangible assets, net

9,491


12,836


14,041

Other assets

210,744


144,126


159,419

Total assets

$   13,953,144


14,501,508


14,389,235

Liabilities and shareholders' equity






Liabilities






Noninterest-bearing demand deposits

$     3,094,120


3,099,526


3,052,115

Interest-bearing demand deposits

2,812,730


2,940,442


2,926,351

Money market deposit accounts

2,577,013


2,629,882


2,584,424

Savings deposits

2,327,419


2,303,760


2,271,496

Time deposits

1,067,110


1,327,555


1,387,827

Total deposits

11,878,392


12,301,165


12,222,213







Borrowed funds

150,036


139,093


126,496

Subordinated debt

113,753


123,575


123,486

Junior subordinated debentures

129,249


129,054


128,989

Advances by borrowers for taxes and insurance

29,647


44,582


26,951

Accrued interest payable

831


1,804


589

Other liabilities

191,450


178,664


198,743

Total liabilities

12,493,358


12,917,937


12,827,467

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, 126,921,989, 126,612,183 and
126,521,344 shares issued and outstanding, respectively

1,269


1,266


1,265

Additional paid-in capital

1,017,189


1,010,405


1,008,099

Retained earnings

632,476


609,529


604,787

Accumulated other comprehensive loss

(191,148)


(37,629)


(52,383)

Total shareholders' equity

1,459,786


1,583,571


1,561,768

Total liabilities and shareholders' equity

$   13,953,144


14,501,508


14,389,235







Equity to assets

10.46 %


10.92 %


10.85 %

Tangible common equity to assets*

7.88 %


8.43 %


8.34 %

Book value per share

$           11.50


12.51


12.34

Tangible book value per share*

$             8.42


9.40


9.22

Closing market price per share

$           13.51


14.16


13.28

Full time equivalent employees

2,191


2,332


2,404

Number of banking offices

150


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


September 30,
2022


June 30,
2022


March 31,
2022


December 31,
2021


September 30,
2021






Interest income:










Loans receivable

$     106,943


95,574


88,174


95,295


97,475

Mortgage-backed securities

8,683


7,158


6,360


5,743


5,840

Taxable investment securities

838


715


677


640


649

Tax-free investment securities

709


683


674


688


628

FHLB stock dividends

148


82


81


82


71

Interest-earning deposits

1,295


1,684


467


467


352

Total interest income

118,616


105,896


96,433


102,915


105,015

Interest expense:










Deposits

3,157


3,341


3,751


4,295


4,540

Borrowed funds

2,710


2,290


2,059


1,964


2,056

Total interest expense

5,867


5,631


5,810


6,259


6,596

Net interest income

112,749


100,265


90,623


96,656


98,419

   Provision for credit losses

7,689


2,629


(1,481)


(1,909)


(4,354)

Net interest income after provision for credit losses

105,060


97,636


92,104


98,565


102,773

Noninterest income:










Loss on sale of investments

(2)


(3)


(2)


(4)


(46)

Service charges and fees

14,323


13,673


13,067


13,500


13,199

Trust and other financial services income

6,650


7,461


7,012


6,820


7,182

Insurance commission income





44

Gain/(loss) on real estate owned, net

290


291


(29)


71


247

Income from bank-owned life insurance

1,475


2,008


1,983


1,343


1,332

Mortgage banking income

766


2,157


1,465


2,120


3,941

Other operating income

3,301


4,861


2,244


3,192


3,287

Total noninterest income

26,803


30,448


25,740


27,042


29,186

Noninterest expense:










Compensation and employee benefits

46,711


48,073


46,917


48,691


49,063

Premises and occupancy costs

7,171


7,280


7,797


7,104


7,745

Office operations

3,229


3,162


3,383


3,144


4,143

Collections expense

322


403


520


602


411

Processing expenses

13,416


12,947


12,548


13,639


13,517

Marketing expenses

2,147


2,047


2,128


2,054


2,102

Federal deposit insurance premiums

1,200


1,130


1,129


1,131


1,184

Professional services

3,363


3,333


2,573


4,513


4,295

Amortization of intangible assets

1,047


1,115


1,183


1,205


1,321

Real estate owned expense

61


72


37


44


94

Merger, asset disposition and restructuring expense



1,374


2,812


Other expenses

3,906


5,245


2,355


1,346


2,227

Total noninterest expense

82,573


84,807


81,944


86,285


86,102

Income before income taxes

49,290


43,277


35,900


39,322


45,857

Income tax expense

11,986


9,851


7,613


9,266


10,794

Net income

$       37,304


33,426


28,287


30,056


35,063











Basic earnings per share

$          0.29


0.26


0.22


0.24


0.28

Diluted earnings per share

$          0.29


0.26


0.22


0.24


0.27











Annualized return on average equity

9.84 %


8.90 %


7.17 %


7.65 %


8.86 %

Annualized return on average assets

1.05 %


0.94 %


0.80 %


0.82 %


0.97 %

Annualized return on tangible common equity *

13.84 %


12.16 %


10.14 %


10.02 %


11.92 %











Efficiency ratio **

58.42 %


64.03 %


68.22 %


66.51 %


66.44 %

Annualized noninterest expense to average assets ***

2.30 %


2.35 %


2.23 %


2.25 %


2.33 %

*

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)



Nine months ended September 30,


2022


2021

Interest income:




Loans receivable

$                         290,691


295,048

Mortgage-backed securities

22,201


15,720

Taxable investment securities

2,230


1,976

Tax-free investment securities

2,066


1,797

FHLB stock dividends

311


325

Interest-earning deposits

3,446


727

Total interest income

320,945


315,593

Interest expense:




Deposits

10,249


14,827

Borrowed funds

7,059


6,160

Total interest expense

17,308


20,987

Net interest income

303,637


294,606

Provision for credit losses

8,837


(9,974)

Net interest income after provision for credit losses

294,800


304,580

Noninterest income:




Loss on sale of investments

(7)


(172)

Service charges and fees

41,063


38,337

Trust and other financial services income

21,123


21,101

Insurance commission income


3,633

Gain on real estate owned, net

552


371

Income from bank-owned life insurance

5,466


4,707

Mortgage banking income

4,388


13,772

Gain on sale of insurance business


25,327

Other operating income

10,406


8,771

Total noninterest income

82,991


115,847

Noninterest expense:




Compensation and employee benefits

141,701


145,196

Premises and occupancy costs

22,248


23,969

Office operations

9,774


10,625

Collections expense

1,245


1,330

Processing expenses

38,911


42,124

Marketing expenses

6,322


6,183

Federal deposit insurance premiums

3,459


3,844

Professional services

9,269


13,108

Amortization of intangible assets

3,345


4,348

Real estate owned expense

170


254

Merger, asset disposition and restructuring expense

1,374


641

Other expenses

11,506


7,003

Total noninterest expense

249,324


258,625

Income before income taxes

128,467


161,802

Income tax expense

29,450


37,535

Net income

$                           99,017


124,267





Basic earnings per share

$                               0.78


0.98

Diluted earnings per share

$                               0.78


0.97





Annualized return on average equity

8.61 %


10.67 %

Annualized return on average assets

0.93 %


1.17 %

Annualized return on tangible common equity *

12.38 %


14.24 %





Efficiency ratio **

63.27 %


65.86 %

Annualized noninterest expense to average assets ***

2.30 %


2.38 %

*

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)



September 30,
2022


June 30,
2022


March 31,
2022


December 31,
2021


September 30,
2021

Nonaccrual loans current:










Residential mortgage loans

$           2,186


1,970


1,884


1,354


2,015

Home equity loans

1,158


1,337


1,376


1,212


1,267

Consumer loans

833


976


1,148


1,336


1,465

Commercial real estate loans

56,193


60,537


79,810


106,233


111,075

Commercial loans

1,801


5,270


6,060


6,098


17,021

Total nonaccrual loans current

$         62,171


70,090


90,278


116,233


132,843

Nonaccrual loans delinquent 30 days to 59 days:










Residential mortgage loans

$               54


2


760


244


99

Home equity loans

316


172


195


223


328

Consumer loans

155


158


190


241


152

Commercial real estate loans

55


911


333


239


205

Commercial loans

237


358


4


53


102

Total nonaccrual loans delinquent 30 days to 59 days

$              817


1,601


1,482


1,000


886

Nonaccrual loans delinquent 60 days to 89 days:










Residential mortgage loans

$               32


199


830


1,163


527

Home equity loans

432


566


371


61


142

Consumer loans

382


226


280


292


291

Commercial real estate loans

848


630



364


419

Commercial loans

132


73



218


170

Total nonaccrual loans delinquent 60 days to 89 days

$           1,826


1,694


1,481


2,098


1,549

Nonaccrual loans delinquent 90 days or more:










Residential mortgage loans

$           5,544


5,445


3,976


7,641


8,069

Home equity loans

1,779


2,081


2,968


4,262


4,745

Consumer loans

2,031


1,942


1,782


2,069


2,184

Commercial real estate loans

8,821


14,949


21,399


24,063


25,562

Commercial loans

638


583


795


1,105


1,104

Total nonaccrual loans delinquent 90 days or more

$         18,813


25,000


30,920


39,140


41,664

Total nonaccrual loans

$         83,627


98,385


124,161


158,471


176,942

Total nonaccrual loans

$         83,627


98,385


124,161


158,471


176,942

Loans 90 days past due and still accruing

357


379


420


331


386

Nonperforming loans

83,984


98,764


124,581


158,802


177,328

Real estate owned, net

450


1,205


929


873


809

Nonperforming assets

$         84,434


99,969


125,510


159,675


178,137

Nonaccrual troubled debt restructuring *

$         30,406


37,647


16,015


17,216


12,858

Accruing troubled debt restructuring

16,344


16,590


12,686


13,072


13,664

Total troubled debt restructuring

$         46,750


54,237


28,701


30,288


26,522











Nonperforming loans to total loans

0.78 %


0.95 %


1.23 %


1.59 %


1.74 %

Nonperforming assets to total assets

0.61 %


0.71 %


0.87 %


1.10 %


1.24 %

Allowance for credit losses to total loans

1.02 %


0.94 %


0.98 %


1.02 %


1.08 %

Allowance for total loans excluding PPP loan balances

1.02 %


0.95 %


0.98 %


1.03 %


1.09 %

Allowance for credit losses to nonperforming loans

130.76 %


99.59 %


79.70 %


64.38 %


61.90 %

*  Amounts included in nonperforming loans above.

 

Northwest Bancshares, Inc. and Subsidiaries
Loans by Credit Quality Indicators (Unaudited)
(dollars in thousands)


At September 30, 2022


Pass


Special

   mention *


Substandard

**


Doubtful


Loss


Loans

receivable

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

At June 30, 2022













Personal Banking:













Residential mortgage loans


$       3,273,117



13,658




3,286,775

Home equity loans


1,275,124



5,368




1,280,492

Consumer loans


1,998,863



3,682




2,002,545

Total Personal Banking


6,547,104



22,708




6,569,812

Commercial Banking:













Commercial real estate loans


2,600,207


51,540


224,429




2,876,176

Commercial loans


954,129


2,468


30,239




986,836

Total Commercial Banking


3,554,336


54,008


254,668




3,863,012

Total loans


$     10,101,440


54,008


277,376




10,432,824

At March 31, 2022













Personal Banking:













Residential mortgage loans


$       3,108,366



13,523




3,121,889

Home equity loans


1,280,342



6,178




1,286,520

Consumer loans


1,892,162



3,819




1,895,981

Total Personal Banking


6,280,870



23,520




6,304,390

Commercial Banking:













Commercial real estate loans


2,633,808


62,091


263,994




2,959,893

Commercial loans


839,125


3,277


32,349




874,751

Total Commercial Banking


3,472,933


65,368


296,343




3,834,644

Total loans


$       9,753,803


65,368


319,863




10,139,034

At December 31, 2021













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

*

Includes $4.5 million, $7.4 million, $4.4 million, $14.9 million, and $16.7 million of acquired loans at September 30, 2022, June 30, 2022, March 31, 2022, December 31, 2021, and September 30, 2021, respectively.

**

Includes $51.4 million, $59.3 million, $71.9 million, $81.5 million, and $110.4 million of acquired loans at September 30, 2022, June 30, 2022, March 31, 2022, December 31, 2021, and September 30, 2021, respectively.

 

Northwest Bancshares, Inc. and Subsidiaries
Loan Delinquency (Unaudited)
(dollars in thousands)



September 30,
2022


*


June 30,
2022


*


March 31,
2022


*


December 31,
2021


*


September 30,
2021


*

(Number of loans and dollar amount of loans)






























Loans delinquent 30 days to 59 days:






























Residential mortgage loans

26


$   1,052


— %


20


$      785


— %


281


$  24,057


0.8 %


277


$  20,567


0.7 %


17


$      765


— %

Home equity loans

88


3,278


0.3 %


107


3,664


0.3 %


105


3,867


0.3 %


112


3,153


0.2 %


101


3,351


0.2 %

Consumer loans

549


6,546


0.3 %


563


6,898


0.3 %


523


6,043


0.3 %


589


6,536


0.4 %


576


6,146


0.3 %

Commercial real estate loans

13


1,332


— %


26


2,701


0.1 %


25


3,643


0.1 %


17


17,065


0.6 %


19


2,004


0.1 %

Commercial loans

48


2,582


0.2 %


24


1,486


0.2 %


16


1,268


0.1 %


12


193


— %


10


692


0.1 %

Total loans delinquent 30 days to 59 days

724


$  14,790


0.1 %


740


$  15,534


0.1 %


950


$  38,878


0.4 %


1,007


$  47,514


0.5 %


723


$  12,958


0.1 %































Loans delinquent 60 days to 89 days:






























Residential mortgage loans

51


$   4,320


0.1 %


61


$   5,941


0.2 %


24


$   1,950


0.1 %


59


$   5,433


0.2 %


55


$   4,907


0.2 %

Home equity loans

36


1,227


0.1 %


28


952


0.1 %


28


1,138


0.1 %


30


949


0.1 %


29


1,024


0.1 %

Consumer loans

223


2,663


0.1 %


178


1,460


0.1 %


159


1,839


0.1 %


195


2,006


0.1 %


180


1,757


0.1 %

Commercial real estate loans

13


1,741


0.1 %


9


1,472


0.1 %


1


112


— %


5


769


— %


8


1,170


— %

Commercial loans

14


808


0.1 %


6


341


— %


3


103


— %


10


727


0.1 %


2


170


— %

Total loans delinquent 60 days to 89 days

337


$  10,759


0.1 %


282


$  10,166


0.1 %


215


$   5,142


0.1 %


299


$   9,884


0.1 %


274


$   9,028


0.1 %































Loans delinquent 90 days or more: **






























Residential mortgage loans

64


$   5,544


0.2 %


63


$   5,445


0.2 %


47


$   3,976


0.1 %


87


$   7,641


0.3 %


95


$   8,069


0.3 %

Home equity loans

65


1,779


0.1 %


69


2,081


0.2 %


91


2,968


0.2 %


105


4,262


0.3 %


119


4,745


0.4 %

Consumer loans

289


2,388


0.1 %


286


2,321


0.1 %


287


2,202


0.1 %


296


2,400


0.1 %


308


2,568


0.1 %

Commercial real estate loans

22


8,821


0.3 %


31


14,949


0.5 %


41


21,399


0.7 %


52


24,063


0.8 %


59


25,562


0.8 %

Commercial loans

11


638


0.1 %


10


583


0.1 %


10


795


0.1 %


8


1,105


0.1 %


10


1,104


0.1 %

Total loans delinquent 90 days or more

451


$  19,170


0.2 %


459


$  25,379


0.2 %


476


$  31,340


0.3 %


548


$  39,471


0.4 %


591


$  42,048


0.4 %































Total loans delinquent

1,512


$  44,719


0.4 %


1,481


$  51,079


0.5 %


1,641


$  75,360


0.7 %


1,854


$  96,869


1.0 %


1,588


$  64,034


0.6 %

*

Represents delinquency, in dollars, divided by the respective total amount of that type of loan outstanding.

**

Includes purchased credit deteriorated loans of $783,000, $6.3 million, $7.1 million, $7.3 million, and $8.4 million at September 30, 2022, June 30, 2022, March 31, 2022,  December 31, 2021, and September 30, 2021, respectively.

 

Northwest Bancshares, Inc. and Subsidiaries
Allowance for Credit Losses (Unaudited)
(dollars in thousands)



Quarter ended


September 30,
2022


June 30,
2022


March 31,
2022


December 31,
2021


September 30,
2021

Beginning balance

$        98,355


99,295


102,241


109,767


117,330

Provision

7,689


2,629


(1,481)


(1,909)


(4,354)

Charge-offs residential mortgage

(166)


(138)


(1,183)


(784)


(1,263)

Charge-offs home equity

(535)


(255)


(447)


(1,299)


(1,474)

Charge-offs consumer

(2,341)


(1,912)


(1,723)


(2,897)


(2,148)

Charge-offs commercial real estate

(1,329)


(4,392)


(1,024)


(2,652)


(1,581)

Charge-offs commercial

(243)


(329)


(681)


(2,586)


(412)

Recoveries

8,389


3,457


3,593


4,601


3,669

Ending balance

$     109,819


98,355


99,295


102,241


109,767

Net (recoveries)/charge-offs to average loans, annualized

(0.14) %


0.14 %


0.06 %


0.22 %


0.12 %

 


Nine months ended September 30,


2022


2021

Beginning balance

$                    102,241


134,427

Provision

8,837


(9,974)

Charge-offs residential mortgage

(1,487)


(2,888)

Charge-offs home equity

(1,237)


(2,081)

Charge-offs consumer

(5,976)


(7,152)

Charge-offs commercial real estate

(6,745)


(10,171)

Charge-offs commercial

(1,253)


(1,627)

Recoveries

15,439


9,233

Ending balance

$                   109,819


109,767

Net charge-offs to average loans, annualized

0.02 %


0.19 %

 

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 


September 30, 2022


June 30, 2022


March 31, 2022


December 31, 2021


September 30, 2021


Average

balance


Interest


Avg.

yield/

cost (h)


Average

balance


Interest


Avg.

yield/

cost (h)


Average

balance


Interest


Avg.

yield/

cost (h)


Average

balance


Interest


Avg.

yield/

cost (h)


Average

balance


Interest


Avg.

yield/

cost (h)

Assets:






























Interest-earning assets:






























Residential mortgage loans

$  3,331,173


29,414


3.53 %


$  3,171,469


27,327


3.45 %


$  2,980,788


25,542


3.43 %


$  2,977,942


25,269


3.39 %


$  2,959,794


25,398


3.43 %

Home equity loans

1,274,918


13,658


4.25 %


1,277,440


11,961


3.76 %


1,293,986


11,472


3.60 %


1,328,553


11,750


3.51 %


1,356,131


11,993


3.51 %

Consumer loans

1,981,754


17,256


3.45 %


1,880,769


15,777


3.36 %


1,799,037


14,907


3.36 %


1,756,620


15,514


3.50 %


1,728,563


16,220


3.72 %

Commercial real estate loans

2,842,597


34,158


4.70 %


2,915,750


31,844


4.32 %


3,000,204


29,757


3.97 %


3,113,924


34,062


4.28 %


3,205,839


35,305


4.31 %

Commercial loans

1,050,124


12,978


4.84 %


912,454


9,090


3.94 %


824,770


6,897


3.34 %


855,998


9,154


4.18 %


975,603


9,096


3.65 %

Total loans receivable (a) (b) (d)

10,480,566


107,464


4.07 %


10,157,882


95,999


3.79 %


9,898,785


88,575


3.63 %


10,033,037


95,749


3.79 %


10,225,930


98,012


3.80 %

Mortgage-backed securities (c)

2,019,715


8,683


1.72 %


1,952,375


7,158


1.47 %


1,945,173


6,360


1.31 %


1,894,683


5,743


1.21 %


1,832,876


5,840


1.27 %

Investment securities (c) (d)

388,755


1,762


1.81 %


376,935


1,590


1.69 %


373,694


1,540


1.65 %


358,558


1,535


1.71 %


348,619


1,466


1.68 %

FHLB stock, at cost

14,028


148


4.19 %


13,428


82


2.44 %


13,870


81


2.38 %


14,459


82


2.25 %


21,607


71


1.31 %

Other interest-earning deposits

253,192


1,295


2.00 %


846,142


1,684


0.79 %


1,218,960


467


0.15 %


1,168,449


467


0.16 %


905,130


352


0.15 %

Total interest-earning assets

13,156,256


119,352


3.60 %


13,346,762


106,513


3.20 %


13,450,482


97,023


2.93 %


13,469,186


103,576


3.05 %


13,334,162


105,741


3.15 %

Noninterest-earning assets (e)

896,663






909,943






973,092






1,004,905






1,074,122





Total assets

$   14,052,919






$   14,256,705






$   14,423,574






$   14,474,091






$   14,408,284





Liabilities and shareholders' equity:






























Interest-bearing liabilities:






























Savings deposits

$  2,350,248


594


0.10 %


$  2,361,919


589


0.10 %


$  2,334,494


592


0.10 %


$  2,282,606


622


0.11 %


$  2,271,365


603


0.11 %

Interest-bearing demand deposits

2,794,338


360


0.05 %


2,857,336


310


0.04 %


2,875,430


321


0.05 %


2,933,466


411


0.06 %


2,890,905


414


0.06 %

Money market deposit accounts

2,620,850


692


0.10 %


2,653,467


668


0.10 %


2,668,105


653


0.10 %


2,618,177


656


0.10 %


2,565,159


637


0.10 %

Time deposits

1,110,906


1,511


0.54 %


1,220,815


1,774


0.58 %


1,292,608


2,185


0.69 %


1,356,513


2,606


0.76 %


1,423,041


2,886


0.80 %

Borrowed funds (f)

127,073


239


0.75 %


123,749


167


0.54 %


135,289


158


0.47 %


135,038


159


0.47 %


131,199


154


0.47 %

Subordinated debt

113,695


1,149


4.04 %


119,563


1,203


4.03 %


123,608


1,250


4.05 %


123,514


1,180


3.82 %


123,513


1,277


4.10 %

Junior subordinated debentures

129,207


1,322


4.00 %


129,142


920


2.82 %


129,077


651


2.02 %


129,012


625


1.89 %


128,946


625


1.90 %

Total interest-bearing liabilities

9,246,317


5,867


0.25 %


9,465,991


5,631


0.24 %


9,558,611


5,810


0.25 %


9,578,326


6,259


0.26 %


9,534,128


6,596


0.27 %

Noninterest-bearing demand deposits (g)

3,093,490






3,090,372






3,060,698






3,093,518






3,058,819





Noninterest-bearing liabilities

209,486






193,510






203,537






242,620






244,402





Total liabilities

12,549,293






12,749,873






12,822,846






12,914,464






12,837,349





Shareholders' equity

1,503,626






1,506,832






1,600,728






1,559,627






1,570,935





Total liabilities and shareholders' equity

$   14,052,919






$   14,256,705






$   14,423,574






$   14,474,091






$   14,408,284





Net interest income/Interest rate spread



113,485


3.35 %




100,882


2.96 %




91,213


2.68 %




97,317


2.79 %




99,145


2.87 %

Net interest-earning assets/Net interest margin

$  3,909,939




3.42 %


$  3,880,771




3.07 %


$  3,891,871




2.75 %


$  3,890,860




2.89 %


$  3,800,034




2.97 %

Ratio of interest-earning assets to interest-
bearing liabilities

1.42X






1.41X






1.41X






1.41X






1.40X





(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 0.11%, 0.11%, 0.12%, 0.14%, and 0.15%, respectively.

(h)

Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans — 4.05%, 3.77%, 3.61%, 3.77%, and 3.79%, respectively, Investment securities — 1.59%, 1.48%, 1.45%, 1.48%, and 1.47%, respectively, Interest-earning assets — 3.58%, 3.18%, 2.91%, 3.03%, and 3.13%, respectively. GAAP basis net interest rate spreads were 3.33%, 2.94%, 2.66%, 2.77%, and 2.86%, respectively, and GAAP basis net interest margins were 3.40%, 3.05%, 2.73%, 2.87%, and 2.95%, respectively.

 

Northwest Bancshares, Inc. and Subsidiaries
Average Balance Sheet (Unaudited)
(in thousands)


The following table sets forth certain information relating to the Company's average balance sheet and reflects the average yield 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
balances are calculated using daily averages.



Nine months ended September 30,


2022


2021


Average

balance


Interest


Avg.

yield/

cost (h)


Average

balance


Interest


Avg.

yield/

cost (h)

Assets












Interest-earning assets:












Residential mortgage loans

$     3,162,758


82,282


3.47 %


$     2,967,248


77,373


3.48 %

Home equity loans

1,282,045


37,443


3.90 %


1,389,367


37,039


3.55 %

Consumer loans

1,887,843


47,588


3.37 %


1,594,834


45,341


3.79 %

Commercial real estate loans

2,918,940


95,813


4.33 %


3,258,785


107,124


4.32 %

Commercial loans

929,942


28,981


4.11 %


1,099,010


29,640


3.54 %

Loans receivable (a) (b) (d)

10,181,528


292,107


3.84 %


10,309,244


296,517


3.83 %

Mortgage-backed securities (c)

1,972,694


22,201


1.50 %


1,639,749


15,720


1.28 %

Investment securities (c) (d)

379,850


4,923


1.73 %


348,193


4,313


1.65 %

FHLB stock, at cost

13,776


311


3.02 %


22,174


325


1.95 %

Other interest-earning deposits

753,482


3,447


0.60 %


838,997


727


0.11 %

Total interest-earning assets

13,301,330


322,989


3.25 %


13,158,357


317,602


3.22 %

Noninterest-earning assets (e)

941,947






1,094,117

















Total assets

$   14,243,277






$   14,252,474

















Liabilities and shareholders' equity












Interest-bearing liabilities:












Savings deposits

$     2,348,944


1,758


0.10 %


$     2,215,553


1,818


0.11 %

Interest-bearing demand deposits

2,842,071


1,008


0.05 %


2,838,822


1,250


0.06 %

Money market deposit accounts

2,647,301


2,067


0.10 %


2,533,676


1,914


0.10 %

Time deposits

1,207,444


5,416


0.60 %


1,499,583


9,845


0.87 %

Borrowed funds (f)

131,368


563


0.57 %


135,369


458


0.45 %

Subordinated debt

118,919


3,603


4.04 %


123,438


3,799


4.10 %

Junior subordinated debentures

129,142


2,893


2.95 %


128,882


1,903


1.94 %

Total interest-bearing liabilities

9,425,189


17,308


0.25 %


9,475,323


20,987


0.30 %

Noninterest-bearing demand deposits (g)

3,081,640






2,967,672





Noninterest-bearing liabilities

199,742






252,587

















Total liabilities

12,706,571






12,695,582

















Shareholders' equity

1,536,706






1,556,892

















Total liabilities and shareholders' equity

$   14,243,277






$   14,252,474

















Net interest income/Interest rate spread



305,681


3.00 %




296,615


2.92 %













Net interest-earning assets/Net interest margin

$     3,876,141




3.07 %


$     3,683,034




3.01 %













Ratio of interest-earning assets to interest-bearing liabilities

1.41X






1.39X





(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 0.11% and 0.16%, respectively.

(h)

Shown on a FTE basis. GAAP basis yields were: Loans — 3.82% and 3.82%, respectively; Investment securities — 1.51% and 1.44%, respectively; Interest-earning assets — 3.23% and 3.20%, respectively. GAAP basis net interest rate spreads were 2.98% and 2.91%, respectively; and GAAP basis net interest margins were 3.05% and 2.99%, respectively.

 

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SOURCE Northwest Bancshares, Inc.

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