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

Rhea-AI Summary

Northwest Bancshares reported a net income of $33.4 million, or $0.26 per diluted share for Q2 2022, down 31.7% from $49.0 million in Q2 2021. The annualized return on average shareholders' equity decreased to 8.90% from 12.58%. A dividend of $0.20 per share was declared, marking the 111th consecutive quarter of dividends. The company saw organic loan growth of $200 million and an improved net interest margin of 3.07%. However, noninterest income declined by 44.3% primarily due to the prior year’s insurance sale.

Positive

• Net interest income increased by $4.5 million, or 4.7%, to $100.3 million compared to Q2 2021.
• Organic loan growth of $200 million, or almost 2.0% during the quarter.
• Improved asset quality with classified loans down 38.8% to $277.4 million.

Negative

• Net income decreased by $15.5 million, or 31.7%, compared to the same quarter last year.
• Noninterest income dropped 44.3% to $30.4 million, largely due to the prior year’s insurance business sale.

COLUMBUS, Ohio, July 25, 2022 /PRNewswire/ -- Northwest Bancshares, Inc., (the "Company"), (NasdaqGS: NWBI) announced net income for the quarter ended June 30, 2022 of $33.4 million, or $0.26 per diluted share.  This represents a decrease of $15.5 million, or 31.7%, compared to the same quarter last year, when net income was $49.0 million, or $0.38 per diluted share.  The annualized returns on average shareholders' equity and average assets for the quarter ended June 30, 2022 were 8.90% and 0.94% compared to 12.58% and 1.37% for the same quarter last year. Prior year earnings were enhanced by a $25.3 million pre-tax gain on the sale of the Northwest insurance line of business. 

The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.20 per share payable on August 15, 2022 to shareholders of record as of August 4, 2022. This is the 111th consecutive quarter in which the Company has paid a cash dividend. Based on the market value of the Company's common stock as of June 30, 2022, this represents an annualized dividend yield of approximately 6.0%. 

During the second quarter, the Company announced the unfortunate passing of Chairman, President, and Chief Executive Officer, Ronald J. Seiffert, from natural causes. Subsequently, as announced on May 25, 2022, the Northwest Bancshares and Northwest Bank Boards of Directors named the Company's Chief Financial Officer, William W. Harvey Jr,. as interim President and Chief Executive Officer and the Company's Lead Director, Timothy B. Fannin, as interim Chairman of the Board.  

Mr. Harvey commented, "Everyone in the Northwest family is deeply saddened by the unexpected passing of Ron. Ron was such a strong leader during his time at Northwest and he positioned us well for the future. We are committed to carrying out his vision and strategic direction for the company."

In relation to the quarterly results, Mr. Harvey noted, "We are pleased with the loan growth momentum generated during the quarter with organic loan growth of approximately $200.0 million, or almost 2.0%, augmented by the purchase of a $50.0 million one-to-four family jumbo mortgage loan portfolio and a $43.0 million small business equipment finance pool.  Also, during the quarter our net interest margin expanded by 32bp as a result of both an increase in market interest rates and the deployment of excess liquidity into higher yielding interest-earning assets."

Mr. Harvey continued, "Asset quality metrics continue to improve with nonperforming and classified assets dropping to $100.0 million and $277.4 million, respectively, and total delinquency and net charge-offs falling to pre-pandemic levels. Outside of an increase in other noninterest expense related primarily to an additional $3.4 million reserve for unfunded loan commitments, we continue to see a favorable trend in expense management over the past five quarters."

Net interest income increased by $4.5 million, or 4.7%, to $100.3 million for the quarter ended June 30, 2022, from $95.7 million for the quarter ended June 30, 2021, due primarily to a $1.5 million increase in both interest income on mortgage-backed securities and interest income on interest-earning deposits.  The increase in interest income on mortgage-backed securities was due to an increase of $196.1 million, or 11.2%, in the average balance of mortgage-backed securities in addition to an increase in the yield on mortgage-backed securities to 1.47% for the quarter ended June 30, 2022 from 1.29% for the quarter ended June 30, 2021.  The increase in interest income on interest-earning deposits was due to an increase of $35.4 million, or 4.4%, in the average balance of interest-earning deposits in addition to an increase in the yield on interest-earning deposits to 0.79% for the quarter ended June 30, 2022 from 0.09% for the quarter ended June 30, 2021. Also contributing to the increase in net interest income was a decrease in interest expense on deposits of $1.4 million, or 30.0%, primarily due to a decrease in our cost of our interest-bearing liabilities to 0.24% for the quarter ended June 30, 2022, from 0.29% for the quarter ended June 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 3.07% for the quarter ended June 30, 2022, from 2.91% for the same quarter last year.

The Company continued to experience improvement in asset quality as classified loans decreased by $175.7 million, or 38.8%, to $277.4 million, or 2.7% of total loans, at June 30, 2022, from $453.1 million, or 4.4% of total loans, at June 30, 2021.  Total delinquent loans also decreased to $51.1 million, or 0.49% of loans receivable, at June 30, 2022 from $68.9 million, or 0.70% of loans receivable, at June 30, 2021. In addition, annualized net charge-offs were 0.14% during the current quarter compared to 0.26% during the same quarter last year. As the result, the provision for credit losses during the current quarter remained historically low at just $2.6 million.

Noninterest income decreased by $24.3 million, or 44.3%, to $30.4 million for the quarter ended June 30, 2022, from $54.7 million for the quarter ended June 30, 2021.  This decrease was primarily due to the sale of our insurance business in the second quarter of 2021, for a pre-tax gain of $25.3 million, which also resulted in a decrease in insurance commission income of $1.0 million, or 100.0% from the quarter ended June 30, 2021. In addition, mortgage banking income decreased by $1.7 million, or 43.4%, to $2.2 million for the quarter ended June 30, 2022 from $3.8 million for the quarter ended June 30, 2021. This decrease reflects the impact of less favorable pricing in the secondary market, due primarily to the volatile interest rate environment. Offsetting these decreases was an increase in other operating income of $2.2 million, or 83.6%, to $4.9 million for the quarter ended June 30, 2022 from $2.6 million for the quarter ended June 30, 2021 due to an increase in swap fee income as well as a gain of approximately $1.0 million from the sale of branch buildings associated with the previously announced consolidation of 20 branch office facilities. 

Noninterest expense decreased by $1.5 million, or 1.8%, to $84.8 million for the quarter ended June 30, 2022 from $86.3 million for the quarter ended June 30, 2021. This decrease primarily resulted from a $2.2 million, or 14.5%, decrease in processing expense to $12.9 million for the quarter ended June 30, 2022 from $15.2 million for the quarter ended June 30, 2021 due to the investment in our technology and infrastructure during the prior year.  Also contributing to this favorable variance was an $898,000, or 21.2%, decrease in professional services to $3.3 million for the quarter ended June 30, 2022 from $4.2 million for the quarter ended June 30, 2021 due to the use of third-party experts to assist with our digital strategy rollout in the prior year.  Compensation and employee benefits also decreased by $821,000, or 1.7%, to $48.1 million for the quarter ended June 30, 2022 from $48.9 million for the quarter ended June 30, 2021, despite recognizing approximately $1.4 million of additional expenses related to the acceleration of compensation and stock benefits upon Mr. Seiffert's passing. The decrease in compensation and employee benefits was driven primarily by the branch consolidations completed in April.  Partially offsetting these decreases was an increase in other expenses of $3.8 million to $5.2 million for the quarter ended June 30, 2022 from $1.4 million for the quarter ended June 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 decreased by $5.3 million, or 34.9%, to $9.9 million for the quarter ended June 30, 2022, from $15.1 million for the quarter ended June 30, 2021, due primarily to a decrease 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 employee benefits and wealth management services. As of June 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.

Forward-Looking Statements - This release may contain forward-looking statements with respect to the financial condition and results of operations of Northwest Bancshares, Inc. including, without limitations, statements relating to the earnings outlook of the Company. These forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements, include among others, the following possibilities: (1) changes in the interest rate environment; (2) competitive pressure among financial services companies; (3) general economic conditions including an increase in non-performing loans; (4) changes in legislation or regulatory requirements; (5) difficulties in continuing to improve operating efficiencies; (6) difficulties in the integration of acquired businesses or the ability to complete sales transactions; (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)
			June 30, 2022		December 31, 2021		June 30, 2021
Assets
Cash and cash equivalents			$        504,532		1,279,259		857,152
Marketable securities available-for-sale (amortized cost of $1,516,743, $1,565,002 and $1,593,813,  respectively)			1,364,743		1,548,592		1,599,024
Marketable securities held-to-maturity (fair value of $835,565, $751,513 and $632,620, respectively)			923,180		768,154		639,424
Total cash and cash equivalents and marketable securities			2,792,455		3,596,005		3,095,600
Residential mortgage loans held-for-sale			31,153		25,056		29,055
Residential mortgage loans			3,255,622		2,969,564		2,925,496
Home equity loans			1,280,492		1,319,931		1,376,228
Consumer loans			2,002,545		1,838,748		1,745,231
Commercial real estate loans			2,876,176		3,015,484		3,215,189
Commercial loans			986,836		847,609		1,018,781
Total loans receivable			10,432,824		10,016,392		10,309,980
Allowance for credit losses			(98,355)		(102,241)		(117,330)
Loans receivable, net			10,334,469		9,914,151		10,192,650
FHLB stock, at cost			13,362		14,184		23,287
Accrued interest receivable			27,708		25,599		27,585
Real estate owned, net			1,205		873		1,353
Premises and equipment, net			146,869		156,524		156,076
Bank-owned life insurance			254,109		256,213		253,539
Goodwill			380,997		380,997		380,997
Other intangible assets, net			10,538		12,836		15,362
Other assets			192,983		144,126		151,607
Total assets			$   14,154,695		14,501,508		14,298,056
Liabilities and shareholders' equity
Liabilities
Noninterest-bearing demand deposits			$     3,058,249		3,099,526		3,002,632
Interest-bearing demand deposits			2,858,691		2,940,442		2,824,219
Money market deposit accounts			2,631,712		2,629,882		2,538,607
Savings deposits			2,362,725		2,303,760		2,262,152
Time deposits			1,155,878		1,327,555		1,463,098
Total deposits			12,067,255		12,301,165		12,090,708
Borrowed funds			130,490		139,093		133,876
Subordinated debt			113,666		123,575		123,501
Junior subordinated debentures			129,184		129,054		128,924
Advances by borrowers for taxes and insurance			55,622		44,582		53,608
Accrued interest payable			1,725		1,804		1,820
Other liabilities			162,214		178,664		190,258
Total liabilities			12,660,156		12,917,937		12,722,695
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, 126,881,766, 126,612,183 and  127,907,885 shares issued and outstanding, respectively			1,269		1,266		1,279
Additional paid-in capital			1,015,349		1,010,405		1,025,174
Retained earnings			620,551		609,529		595,100
Accumulated other comprehensive loss			(142,630)		(37,629)		(46,192)
Total shareholders' equity			1,494,539		1,583,571		1,575,361
Total liabilities and shareholders' equity			$  14,154,695		14,501,508		14,298,056
Equity to assets			10.56 %		10.92 %		11.02 %
Tangible common equity to assets*			8.01 %		8.43 %		8.48 %
Book value per share			$            11.78		12.51		12.32
Tangible book value per share*			$              8.69		9.40		9.22
Closing market price per share			$            12.80		14.16		13.64
Full time equivalent employees			2,188		2,332		2.393
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
	June 30, 2022		March 31, 2022		December 31, 2021		September 30, 2021		June 30, 2021
Interest income:
Loans receivable	$       95,574		88,174		95,295		97,475		95,255
Mortgage-backed securities	7,158		6,360		5,743		5,840		5,680
Taxable investment securities	715		677		640		649		693
Tax-free investment securities	683		674		688		628		594
FHLB stock dividends	82		81		82		71		138
Interest-earning deposits	1,684		467		467		352		192
Total interest income	105,896		96,433		102,915		105,015		102,552
Interest expense:
Deposits	3,341		3,751		4,295		4,540		4,773
Borrowed funds	2,290		2,059		1,964		2,056		2,050
Total interest expense	5,631		5,810		6,259		6,596		6,823
Net interest income	100,265		90,623		96,656		98,419		95,729
Provision for credit losses	2,629		(1,481)		(1,909)		(4,354)		—
Net interest income after provision for credit losses	97,636		92,104		98,565		102,773		95,729
Noninterest income:
Loss on sale of investments	(3)		(2)		(4)		(46)		(105)
Service charges and fees	13,673		13,067		13,500		13,199		12,744
Trust and other financial services income	7,461		7,012		6,820		7,182		7,435
Insurance commission income	—		—		—		44		1,043
Gain/(loss) on real estate owned, net	291		(29)		71		247		166
Income from bank-owned life insurance	2,008		1,983		1,343		1,332		1,639
Mortgage banking income	2,157		1,465		2,120		3,941		3,811
Gain on sale of insurance business	—		—		—		—		25,327
Other operating income	4,861		2,244		3,192		3,287		2,648
Total noninterest income	30,448		25,740		27,042		29,186		54,708
Noninterest expense:
Compensation and employee benefits	48,073		46,917		48,691		49,063		48,894
Premises and occupancy costs	7,280		7,797		7,104		7,745		7,410
Office operations	3,162		3,383		3,144		4,143		3,317
Collections expense	403		520		602		411		303
Processing expenses	12,947		12,548		13,639		13,517		15,151
Marketing expenses	2,047		2,128		2,054		2,102		2,101
Federal deposit insurance premiums	1,130		1,129		1,131		1,184		1,353
Professional services	3,333		2,573		4,513		4,295		4,231
Amortization of intangible assets	1,115		1,183		1,205		1,321		1,433
Real estate owned expense	72		37		44		94		85
Merger, asset disposition and restructuring expense	—		1,374		2,812		—		632
Other expenses	5,245		2,355		1,346		2,227		1,422
Total noninterest expense	84,807		81,944		86,285		86,102		86,332
Income before income taxes	43,277		35,900		39,322		45,857		64,105
Income tax expense	9,851		7,613		9,266		10,794		15,138
Net income	$       33,426		28,287		30,056		35,063		48,967
Basic earnings per share	$           0.26		0.22		0.24		0.28		0.38
Diluted earnings per share	$           0.26		0.22		0.24		0.27		0.38
Annualized return on average equity	8.90 %		7.17 %		7.65 %		8.86 %		12.58 %
Annualized return on average assets	0.94 %		0.80 %		0.82 %		0.97 %		1.37 %
Annualized return on tangible common equity *	12.16 %		10.14 %		10.02 %		11.92 %		16.66 %
Efficiency ratio **	64.03 %		68.22 %		66.51 %		66.44 %		67.35 %
Annualized noninterest expense to average assets ***	2.35 %		2.23 %		2.25 %		2.33 %		2.35 %

*      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)
	Six months ended June 30,
	2022		2021
Interest income:
Loans receivable	$                         183,748		197,573
Mortgage-backed securities	13,518		9,880
Taxable investment securities	1,392		1,327
Tax-free investment securities	1,357		1,169
FHLB stock dividends	163		254
Interest-earning deposits	2,151		375
Total interest income	202,329		210,578
Interest expense:
Deposits	7,092		10,287
Borrowed funds	4,349		4,104
Total interest expense	11,441		14,391
Net interest income	190,888		196,187
Provision for credit losses	1,148		(5,620)
Net interest income after provision for credit losses	189,740		201,807
Noninterest income:
Loss on sale of investments	(5)		(126)
Service charges and fees	26,740		25,138
Trust and other financial services income	14,473		13,919
Insurance commission income	—		3,589
Gain on real estate owned, net	262		124
Income from bank-owned life insurance	3,991		3,375
Mortgage banking income	3,622		9,831
Gain on sale of insurance business	—		25,327
Other operating income	7,105		5,484
Total noninterest income	56,188		86,661
Noninterest expense:
Compensation and employee benefits	94,990		96,133
Premises and occupancy costs	15,077		16,224
Office operations	6,545		6,482
Collections expense	923		919
Processing expenses	25,495		28,607
Marketing expenses	4,175		4,081
Federal deposit insurance premiums	2,259		2,660
Professional services	5,906		8,813
Amortization of intangible assets	2,298		3,027
Real estate owned expense	109		160
Merger, asset disposition and restructuring expense	1,374		641
Other expenses	7,600		4,776
Total noninterest expense	166,751		172,523
Income before income taxes	79,177		115,945
Income tax expense	17,464		26,741
Net income	$                           61,713		89,204
Basic earnings per share	$                               0.49		0.70
Diluted earnings per share	$                               0.49		0.70
Annualized return on average equity	8.01 %		11.61 %
Annualized return on average assets	0.87 %		1.27 %
Annualized return on tangible common equity *	11.28 %		15.26 %
Efficiency ratio **	66.00 %		65.57 %
Annualized noninterest expense to average assets ***	2.29 %		2.40 %

*      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)
	June 30, 2022		March 31, 2022		December 31, 2021		September 30, 2021		June 30, 2021
Nonaccrual loans current:
Residential mortgage loans	$           1,970		1,884		1,354		2,015		189
Home equity loans	1,337		1,376		1,212		1,267		170
Consumer loans	976		1,148		1,336		1,465		188
Commercial real estate loans	60,537		79,810		106,233		111,075		138,820
Commercial loans	5,270		6,060		6,098		17,021		17,545
Total nonaccrual loans current	$         70,090		90,278		116,233		132,843		156,912
Nonaccrual loans delinquent 30 days to 59 days:
Residential mortgage loans	$                  2		760		244		99		68
Home equity loans	172		195		223		328		229
Consumer loans	158		190		241		152		230
Commercial real estate loans	911		333		239		205		1,589
Commercial loans	358		4		53		102		406
Total nonaccrual loans delinquent 30 days to 59 days	$           1,601		1,482		1,000		886		2,522
Nonaccrual loans delinquent 60 days to 89 days:
Residential mortgage loans	$              199		830		1,163		527		207
Home equity loans	566		371		61		142		310
Consumer loans	226		280		292		291		297
Commercial real estate loans	630		—		364		419		198
Commercial loans	73		—		218		170		21
Total nonaccrual loans delinquent 60 days to 89 days	$           1,694		1,481		2,098		1,549		1,033
Nonaccrual loans delinquent 90 days or more:
Residential mortgage loans	$           5,445		3,976		7,641		8,069		10,007
Home equity loans	2,081		2,968		4,262		4,745		6,256
Consumer loans	1,942		1,782		2,069		2,184		2,341
Commercial real estate loans	14,949		21,399		24,063		25,562		23,564
Commercial loans	583		795		1,105		1,104		4,126
Total nonaccrual loans delinquent 90 days or more	$         25,000		30,920		39,140		41,664		46,294
Total nonaccrual loans	$         98,385		124,161		158,471		176,942		206,761
Total nonaccrual loans	$         98,385		124,161		158,471		176,942		206,761
Loans 90 days past due and still accruing	379		420		331		386		302
Nonperforming loans	98,764		124,581		158,802		177,328		207,063
Real estate owned, net	1,205		929		873		809		1,353
Nonperforming assets	$         99,969		125,510		159,675		178,137		208,416
Nonaccrual troubled debt restructuring *	$         37,647		16,015		17,216		12,858		8,951
Accruing troubled debt restructuring	16,590		12,686		13,072		13,664		18,480
Total troubled debt restructuring	$         54,237		28,701		30,288		26,522		27,431
Nonperforming loans to total loans	0.95 %		1.23 %		1.59 %		1.74 %		2.01 %
Nonperforming assets to total assets	0.71 %		0.87 %		1.10 %		1.24 %		1.46 %
Allowance for credit losses to total loans	0.94 %		0.98 %		1.02 %		1.08 %		1.14 %
Allowance for total loans excluding PPP loan balances	0.95 %		0.98 %		1.03 %		1.09 %		1.17 %
Allowance for credit losses to nonperforming loans	99.59 %		79.70 %		64.38 %		61.90 %		56.66 %

*  Amounts included in nonperforming loans above.

 

Northwest Bancshares, Inc. and Subsidiaries
Loans by Credit Quality Indicators (Unaudited)
(dollars in thousands)
At June 30, 2022		Pass		Special    mention *		Substandard **		Doubtful		Loss		Loans receivable
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
At June 30, 2021
Personal Banking:
Residential mortgage loans		$       2,937,418		—		17,133		—		—		2,954,551
Home equity loans		1,367,765		—		8,463		—		—		1,376,228
Consumer loans		1,741,872		—		3,359		—		—		1,745,231
Total Personal Banking		6,047,055		—		28,955		—		—		6,076,010
Commercial Banking:
Commercial real estate loans		2,781,734		73,167		360,288		—		—		3,215,189
Commercial loans		943,665		11,266		63,850		—		—		1,018,781
Total Commercial Banking		3,725,399		84,433		424,138		—		—		4,233,970
Total loans		$       9,772,454		84,433		453,093		—		—		10,309,980

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

**  Includes $59.3 million, $71.9 million, $81.5 million, $110.4 million, and $122.5 million of acquired loans at June 30, 2022, March 31, 2022, December 31, 2021, September 30, 2021, and June 30, 2021, respectively.

 

Northwest Bancshares, Inc. and Subsidiaries
Loan Delinquency (Unaudited)
(dollars in thousands)
	June 30, 2022				*		March 31, 2022				*		December 31, 2021				*		September 30, 2021				*		June 30, 2021				*
(Number of loans and dollar amount of loans)
Loans delinquent 30 days to 59 days:
Residential mortgage loans	20		$      785		— %		281		$  24,057		0.8 %		277		$  20,567		0.7 %		17		$      765		— %		13		$      606		— %
Home equity loans	107		3,664		0.3 %		105		3,867		0.3 %		112		3,153		0.2 %		101		3,351		0.2 %		91		3,677		0.3 %
Consumer loans	563		6,898		0.3 %		523		6,043		0.3 %		589		6,536		0.4 %		576		6,146		0.3 %		532		5,571		0.3 %
Commercial real estate loans	26		2,701		0.1 %		25		3,643		0.1 %		17		17,065		0.6 %		19		2,004		0.1 %		13		2,857		0.1 %
Commercial loans	24		1,486		0.2 %		16		1,268		0.1 %		12		193		— %		10		692		0.1 %		15		686		0.1 %
Total loans delinquent 30 days to 59 days	740		$  15,534		0.1 %		950		$  38,878		0.4 %		1,007		$  47,514		0.5 %		723		$  12,958		0.1 %		664		$  13,397		0.1 %
Loans delinquent 60 days to 89 days:
Residential mortgage loans	61		$   5,941		0.2 %		24		$   1,950		0.1 %		59		$   5,433		0.2 %		55		$   4,907		0.2 %		58		$   4,051		0.1 %
Home equity loans	28		952		0.1 %		28		1,138		0.1 %		30		949		0.1 %		29		1,024		0.1 %		36		1,502		0.1 %
Consumer loans	178		1,460		0.1 %		159		1,839		0.1 %		195		2,006		0.1 %		180		1,757		0.1 %		181		1,988		0.1 %
Commercial real estate loans	9		1,472		0.1 %		1		112		— %		5		769		— %		8		1,170		— %		9		1,335		— %
Commercial loans	6		341		— %		3		103		— %		10		727		0.1 %		2		170		— %		2		27		— %
Total loans delinquent 60 days to 89 days	282		$  10,166		0.1 %		215		$   5,142		0.1 %		299		$   9,884		0.1 %		274		$   9,028		0.1 %		286		$   8,903		0.1 %
Loans delinquent 90 days or more: **
Residential mortgage loans	63		$   5,445		0.2 %		47		$   3,976		0.1 %		87		$   7,641		0.3 %		95		$   8,069		0.3 %		115		$  10,007		0.3 %
Home equity loans	69		2,081		0.2 %		91		2,968		0.2 %		105		4,262		0.3 %		119		4,745		0.4 %		146		6,256		0.5 %
Consumer loans	286		2,321		0.1 %		287		2,202		0.1 %		296		2,400		0.1 %		308		2,568		0.1 %		356		2,643		0.2 %
Commercial real estate loans	31		14,949		0.5 %		41		21,399		0.7 %		52		24,063		0.8 %		59		25,562		0.8 %		83		23,564		0.7 %
Commercial loans	10		583		0.1 %		10		795		0.1 %		8		1,105		0.1 %		10		1,104		0.1 %		18		4,126		0.4 %
Total loans delinquent 90 days or more	459		$  25,379		0.2 %		476		$  31,340		0.3 %		548		$  39,471		0.4 %		591		$  42,048		0.4 %		718		$  46,596		0.5 %
Total loans delinquent	1,481		$  51,079		0.5 %		1,641		$  75,360		0.7 %		1,854		$  96,869		1.0 %		1,588		$  64,034		0.6 %		1,668		$  68,896		0.7 %

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

**  Includes purchased credit deteriorated loans of $6.3 million, $7.1 million, $7.3 million, $8.4 million, and $10.3 million at June 30, 2022, March 31, 2022, December 31, 2021, September 30, 2021, and June 30, 2021, respectively.

 

Northwest Bancshares, Inc. and Subsidiaries
Allowance for Credit Losses (Unaudited)
(dollars in thousands)
	Quarter ended
	June 30, 2022		March 31, 2022		December 31, 2021		September 30, 2021		June 30, 2021
Beginning balance	$        99,295		102,241		109,767		117,330		123,997
Provision	2,629		(1,481)		(1,909)		(4,354)		—
Charge-offs residential mortgage	(138)		(1,183)		(784)		(1,263)		(770)
Charge-offs home equity	(255)		(447)		(1,299)		(1,474)		(379)
Charge-offs consumer	(1,912)		(1,723)		(2,897)		(2,148)		(2,401)
Charge-offs commercial real estate	(4,392)		(1,024)		(2,652)		(1,581)		(3,964)
Charge-offs commercial	(329)		(681)		(2,586)		(412)		(1,161)
Recoveries	3,457		3,593		4,601		3,669		2,008
Ending balance	$        98,355		99,295		102,241		109,767		117,330
Net charge-offs to average loans, annualized	0.14 %		0.06 %		0.22 %		0.12 %		0.26 %

 

	Six months ended June 30,
	2022		2021
Beginning balance	$                    102,241		134,427
Provision	1,148		(5,620)
Charge-offs residential mortgage	(1,321)		(1,625)
Charge-offs home equity	(702)		(607)
Charge-offs consumer	(3,635)		(5,004)
Charge-offs commercial real estate	(5,416)		(8,590)
Charge-offs commercial	(1,010)		(1,215)
Recoveries	7,050		5,564
Ending balance	$                      98,355		117,330
Net charge-offs to average loans, annualized	0.10 %		0.22 %

 

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
	June 30, 2022						March 31, 2022						December 31, 2021						September 30, 2021						June 30, 2021
	Average balance		Interest		Avg. yield/ cost (i)		Average balance		Interest		Avg. yield/ cost (i)		Average balance		Interest		Avg. yield/ cost (i)		Average balance		Interest		Avg. yield/ cost (i)		Average balance		Interest		Avg. yield/ cost (i)
Assets:
Interest-earning assets:
Residential mortgage loans	$  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 %		$  2,935,034		25,609		3.49 %
Home equity loans	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 %		1,380,794		12,232		3.55 %
Consumer loans	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 %		1,589,739		14,555		3.67 %
Commercial real estate loans	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 %		3,257,810		33,349		4.05 %
Commercial loans	912,454		9,090		3.94 %		824,770		6,897		3.34 %		855,998		9,154		4.18 %		975,603		9,096		3.65 %		1,133,969		9,978		3.48 %
Total loans receivable (a) (b) (d)	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 %		10,297,346		95,723		3.73 %
Mortgage-backed securities (c)	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 %		1,756,227		5,680		1.29 %
Investment securities (c) (d)	376,935		1,590		1.69 %		373,694		1,540		1.65 %		358,558		1,535		1.71 %		348,619		1,466		1.68 %		364,414		1,466		1.61 %
FHLB stock, at cost	13,428		82		2.44 %		13,870		81		2.38 %		14,459		82		2.25 %		21,607		71		1.31 %		23,107		138		2.40 %
Other interest-earning deposits	846,142		1,684		0.79 %		1,218,960		467		0.15 %		1,168,449		467		0.16 %		905,130		352		0.15 %		810,741		192		0.09 %
Total interest-earning assets	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 %		13,251,835		103,199		3.12 %
Noninterest-earning assets (e)	909,943						973,092						1,004,905						1,074,122						1,104,924
Total assets	$   14,256,705						$   14,423,574						$   14,474,091						$   14,408,284						$   14,356,759
Liabilities and shareholders' equity:
Interest-bearing liabilities:
Savings deposits	$  2,361,919		589		0.10 %		$  2,334,494		592		0.10 %		$  2,282,606		622		0.11 %		$  2,271,365		603		0.11 %		$  2,255,578		590		0.10 %
Interest-bearing demand deposits	2,857,336		310		0.04 %		2,875,430		321		0.05 %		2,933,466		411		0.06 %		2,890,905		414		0.06 %		2,840,949		407		0.06 %
Money market deposit accounts	2,653,467		668		0.10 %		2,668,105		653		0.10 %		2,618,177		656		0.10 %		2,565,159		637		0.10 %		2,537,629		621		0.10 %
Time deposits	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 %		1,493,947		3,155		0.85 %
Borrowed funds (f)	123,749		167		0.54 %		135,289		158		0.47 %		135,038		159		0.47 %		131,199		154		0.47 %		131,240		150		0.46 %
Subordinated debt (g)	119,563		1,203		4.03 %		123,608		1,250		4.05 %		123,514		1,180		3.82 %		123,513		1,277		4.10 %		123,443		1,264		4.11 %
Junior subordinated debentures	129,142		920		2.82 %		129,077		651		2.02 %		129,012		625		1.89 %		128,946		625		1.90 %		128,882		636		1.95 %
Total interest-bearing liabilities	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 %		9,511,668		6,823		0.29 %
Noninterest-bearing demand deposits (h)	3,090,372						3,060,698						3,093,518						3,058,819						3,036,202
Noninterest-bearing liabilities	193,510						203,537						242,620						244,402						247,930
Total liabilities	12,749,873						12,822,846						12,914,464						12,837,349						12,795,800
Shareholders' equity	1,506,832						1,600,728						1,559,627						1,570,935						1,560,959
Total liabilities and shareholders' equity	$   14,256,705						$   14,423,574						$   14,474,091						$   14,408,284						$   14,356,759
Net interest income/Interest rate spread			100,882		2.96 %				91,213		2.68 %				97,317		2.79 %				99,145		2.87 %				96,376		2.84 %
Net interest-earning assets/Net interest margin	$  3,880,771				3.07 %		$  3,891,871				2.75 %		$  3,890,860				2.89 %		$  3,800,034				2.97 %		$  3,740,167				2.91 %
Ratio of interest-earning assets to interest-bearing liabilities	1.41X						1.41X						1.41X						1.40X						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 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)	On September 9, 2020, the Company issued $125.0 million of 4.00% fixed-to-floating rate subordinated notes with a maturity of September 15, 2030.
(h)	Average cost of deposits were 0.11%, 0.12%, 0.14%, 0.15%, and 0.16%, respectively.
(i)	Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans — 3.77%, 3.61%, 3.77%, 3.79%, and 3.71%, respectively, Investment securities — 1.48%, 1.45%, 1.48%, 1.47%, and 1.41%, respectively, Interest-earning assets — 3.18%, 2.91%, 3.03%, 3.13%, and 3.10%, respectively. GAAP basis net interest rate spreads were 2.94%, 2.66%, 2.77%, 2.86%, and 2.82%, respectively, and GAAP basis net interest margins were 3.05%, 2.73%, 2.87%, 2.95%, and 2.89%, 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.

 

	Six months ended June 30,
	2022						2021
	Average balance		Interest		Avg. yield/ cost (i)		Average balance		Interest		Avg. yield/ cost (i)
Assets
Interest-earning assets:
Residential mortgage loans	$     3,077,155		52,868		3.44 %		$     2,971,037		51,975		3.50 %
Home equity loans	1,285,668		23,433		3.68 %		1,406,260		25,046		3.57 %
Consumer loans	1,840,110		30,684		3.36 %		1,526,861		29,121		3.82 %
Commercial real estate loans	2,957,744		61,601		4.14 %		3,285,696		71,820		4.32 %
Commercial loans	868,854		15,987		3.66 %		1,161,736		20,543		3.50 %
Loans receivable (a) (b) (d)	10,029,531		184,573		3.71 %		10,351,590		198,505		3.85 %
Mortgage-backed securities (c)	1,948,794		13,518		1.39 %		1,541,585		9,880		1.28 %
Investment securities (c) (d)	375,323		3,130		1.67 %		347,977		2,847		1.64 %
FHLB stock, at cost	13,648		163		2.41 %		22,462		254		2.27 %
Other interest-earning deposits	1,003,627		2,151		0.43 %		805,930		375		0.09 %
Total interest-earning assets	13,370,923		203,535		3.07 %		13,069,544		211,861		3.25 %
Noninterest-earning assets (e)	969,111						1,103,734
Total assets	$   14,340,034						$   14,173,278
Liabilities and shareholders' equity
Interest-bearing liabilities:
Savings deposits	$     2,348,282		1,181		0.10 %		$     2,187,184		1,215		0.11 %
Interest-bearing demand deposits	2,866,333		631		0.04 %		2,812,348		836		0.06 %
Money market deposit accounts	2,660,745		1,321		0.10 %		2,517,673		1,278		0.10 %
Time deposits	1,256,513		3,959		0.64 %		1,538,489		6,959		0.91 %
Borrowed funds (f)	129,487		324		0.50 %		137,488		303		0.44 %
Subordinated debt (g)	121,574		2,454		4.04 %		123,400		2,522		4.10 %
Junior subordinated debentures	129,109		1,571		2.42 %		128,850		1,278		1.96 %
Total interest-bearing liabilities	9,512,043		11,441		0.24 %		9,445,432		14,391		0.31 %
Noninterest-bearing demand deposits (h)	3,075,617						2,921,343
Noninterest-bearing liabilities	198,854						256,748
Total liabilities	12,786,514						12,623,523
Shareholders' equity	1,553,520						1,549,755
Total liabilities and shareholders' equity	$   14,340,034						$   14,173,278
Net interest income/Interest rate spread			192,094		2.83 %				197,470		2.94 %
Net interest-earning assets/Net interest margin	$     3,858,880				2.87 %		$     3,624,112				3.02 %
Ratio of interest-earning assets to interest-bearing liabilities	1.41X						1.38X

(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)	On September 9, 2020, the Company issued $125.0 million of 4.00% fixed-to-floating rate subordinated notes with a maturity of September 15, 2030.
(h)	Average cost of deposits were 0.12% and 0.17%, respectively.
(i)	Shown on a FTE basis. GAAP basis yields were: Loans — 3.69% and 3.83%, respectively; Investment securities — 1.46% and 1.43%, respectively; Interest-earning assets — 3.05% and 3.23%, respectively. GAAP basis net interest rate spreads were 2.81% and 2.92%, respectively; and GAAP basis net interest margins were 2.86% and 3.00%, respectively.

 

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SOURCE Northwest Bancshares, Inc.

FAQ

What were Northwest Bancshares' earnings for Q2 2022?

Northwest Bancshares reported earnings of $33.4 million, or $0.26 per diluted share for Q2 2022.

How does Q2 2022 net income compare to Q2 2021 for NWBI?

Net income for Q2 2022 decreased by 31.7% from $49.0 million in Q2 2021.

What dividend was declared by Northwest Bancshares in Q2 2022?

A quarterly cash dividend of $0.20 per share was declared for Q2 2022.

What was the organic loan growth for NWBI in Q2 2022?

Northwest Bancshares experienced organic loan growth of approximately $200 million, nearly 2% in Q2 2022.