Northwest Bancshares, Inc. Announces Branch Optimization Plan

Rhea-AI Summary

Northwest Bancshares announced plans to close 42 of its 205 branches, or around 20%, from December 14 to December 18, 2020, to adapt to evolving customer preferences and increase operational efficiency. This decision follows a trend towards digital banking, accelerated by the COVID-19 pandemic. The branch optimization is anticipated to incur approximately $12 million in pre-tax costs, but should lead to annual pre-tax operating expense reductions of about $13 million starting in 2021.

Positive

• Anticipated annual reduction in pre-tax operating expenses of approximately $13 million starting in 2021.
• Optimization reflects a strategic response to customer preferences shifting towards digital banking.

Negative

• Incurring approximately $12 million in pre-tax costs related to branch closures.

WARREN, Pa., Sept. 14, 2020 /PRNewswire/ -- On September 14, 2020, Northwest Bancshares, Inc. (the "Company") announced plans to optimize its branch network as part of its ongoing efforts to accommodate changing customer behaviors while also recognizing operating efficiencies.  The Company plans to close 42 of its 205 full-service offices, or approximately 20%, throughout its footprint, one free-standing drive-through and one business office beginning Monday, December 14 through Friday, December 18, 2020.   

In making this announcement, Ronald J. Seiffert, Chairman, President and CEO, noted, "Our customers' banking preferences continue to evolve to favor a more digital banking experience and the COVID-19 pandemic has magnified and accelerated these preferences.  This branch optimization plan reflects our ongoing efforts to ensure we are well positioned in our industry to provide the community bank experience that is valued by our customer base while also enhancing our strong digital and mobile banking presence.  We are confident in the abilities of our dedicated employees to continue to provide our loyal customers and communities the award-winning services they deserve." 

In connection with this plan, the Company anticipates approximately $12 million in pre-tax costs which are expected to be recognized during the second half of 2020.  The annual reduction in pre-tax operating expenses beginning in 2021 are estimated to be approximately $13 million. 

About Northwest Bancshares, Inc.

Headquartered in Warren, Pennsylvania, Northwest Bancshares, Inc. is the holding company of Northwest Bank.  Founded in 1896, Northwest Bank is a full-service financial institution offering a complete line of business and personal banking products, employee benefits and wealth management services, as well as the fulfillment of business and personal insurance needs. The Company operates 205 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 online at www.northwest.com. 

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SOURCE Northwest Bancshares, Inc.

FAQ

What branch closures is Northwest Bancshares planning for December 2020?

Northwest Bancshares plans to close 42 branches between December 14 and December 18, 2020.

How much will Northwest Bancshares save from branch optimization?

Northwest Bancshares expects to reduce pre-tax operating expenses by approximately $13 million annually starting in 2021.

What are the expected costs related to the branch optimization by Northwest Bancshares?

The expected pre-tax costs for the branch optimization are approximately $12 million.

Why is Northwest Bancshares optimizing its branch network?

The optimization aims to accommodate changing customer behaviors towards digital banking, accelerated by the COVID-19 pandemic.

What percentage of branches is Northwest Bancshares closing?

Northwest Bancshares is closing approximately 20% of its branches.