Northwest Bancshares, Inc. Announces Second Quarter 2018 Earnings and Quarterly Dividend

Northwest Bancshares, Inc. Announces Second Quarter 2018 Earnings and Quarterly Dividend

PR Newswire

WARREN, Pa., July 23, 2018 /PRNewswire/ -- Northwest Bancshares, Inc. NWBI announced net income for the quarter ended June 30, 2018 of $26.3 million, or $0.25 per diluted share. This represents a decrease of $4.7 million, or 15.1%, compared to the same quarter last year when net income was $31.0 million or $0.30 per diluted share. The prior year's quarterly earnings were augmented by the sale of the Company's three Maryland offices for a profit of $17.2 million, or approximately $10.3 million after tax. The annualized returns on average shareholders' equity and average assets for the quarter ended June 30, 2018 were 8.67% and 1.11% compared to 10.48% and 1.30% for the same quarter last year.

Northwest Bank (PRNewsfoto/Northwest Bank)

The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.17 per share payable on August 16, 2018, to shareholders of record as of August 2, 2018. This is the 95th consecutive quarter in which the Company has paid a cash dividend. Based on the market value of the Company's stock as of June 30, 2018, this represents an annualized dividend yield of approximately 4.0%.

In making this announcement, Ronald J. Seiffert, President and CEO, noted, "We are very pleased with the positive momentum established in the first half of this year. We remained disciplined in our loan growth of approximately $150 million, or nearly 2%, all funded with organic increases in checking and savings accounts. Expense reductions of almost $8 million, or over 5% from the prior year, were realized from the efficiency initiatives implemented during the past two years.  In addition, we were able to maintain a stable net interest rate spread and margin despite the continued flattening of the yield curve. Finally, with the June announcement of our merger with Donegal Financial Services Corporation and Union Community Bank, scheduled to close in the first quarter of 2019, we are looking forward to the meaningful impact that the employees and this franchise will have on Northwest going into next year."

Net interest income increased by $1.5 million, or 1.8%, to $84.2 million for the quarter ended June 30, 2018, from $82.7 million for the quarter ended June 30, 2017 primarily due to a $3.4 million, or 4.0%, increase in interest income on loans receivable. This increase was primarily the result of an increase in the average balance of loans receivable of $196.8 million, or 2.6%, and an increase in the average yield on loans receivable of six basis points as a result of the recent increases in market interest rates. Partially offsetting this improvement was an increase in interest expense on deposits of $1.5 million, or 25.5%, due to the aforementioned increases in market interest rates. The net impact of these changes caused the Company's net interest margin to increase to 3.72% for the quarter ended June 30, 2018 from 3.66% for the same quarter last year.

The provision for loan losses decreased by $213,000, or 3.8%, to $5.3 million for the quarter ended June 30, 2018, from $5.6 million for the quarter ended June 30, 2017. This decrease is due primarily to the improvement in the historical loss rates for commercial loans when compared to the prior year. Also, reserves in the first half of 2017 were elevated in connection with the closure of the Company's consumer finance subsidiary. Additionally, total nonaccrual loans decreased to $62.7 million, or 0.79% of total loans at June 30, 2018 from $72.8 million, or 0.95% of total loans, at June 30, 2017.

Noninterest income decreased by $17.4 million, or 41.9%, to $24.1 million for the quarter ended June 30, 2018, from $41.5 million for the quarter ended June 30, 2017. This decrease was due primarily to the previously referenced $17.2 million gain on the sale of the Company's Maryland offices during the second quarter of 2017. The remaining items of noninterest income decreased by $182,000, or 0.7%, from the prior year.

Noninterest expense decreased by $3.5 million, or 4.7%, to $69.8 million for the quarter ended June 30, 2018, from $73.3 million for the quarter ended June 30, 2017. This decrease resulted primarily from a $2.2 million, or 85.1%, decrease in restructuring/ acquisition expense due primarily to restructuring that occurred during 2017, including the closure of the Company's consumer finance subsidiary. Additionally, marketing expense decreased by $832,000, or 29.2%, due primarily to the timing of checking account acquisition campaigns.

Income tax expense decreased by $7.5 million, or 52.1%, to $6.9 million for the quarter ended June 30, 2018 from $14.4 million for the quarter ended June 30, 2017. This decrease resulted primarily from a decrease in income before tax of $12.2 million, or 26.8%, to $33.2 million for the quarter ended June 30, 2018 from $45.4 million for the quarter ended June 30, 2017. In addition, primarily as a result of the enactment of the Tax Cuts and Jobs Act in December 2017, the Company's effective tax rate, which includes both federal and state income taxes, decreased to 20.8% for the quarter ended June 30, 2018 from 31.7% for last year's quarter.

Net income for the six month period ended June 30, 2018 was $51.3 million, or $0.50 per diluted share. This represents an increase of $2.6 million, or 5.2%, compared to the six month period ended June 30, 2017, when net income was $48.7 million, or $0.48 per diluted share. The annualized returns on average shareholders' equity and average assets for the six month period ended June 30, 2018 were 8.54% and 1.09% compared to 8.34% and 1.03% for the same period last year. This increase in net income was the result of an increase in net interest income after provision of $3.3 million, or 2.2%, a reduction in noninterest expense of $7.7 million, or 5.3%, and a lower effective tax rate as prescribed by the Tax Cuts and Jobs Act.

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. Northwest operates 162 full-service community banking offices and ten free standing drive-through facilities in Pennsylvania, New York and Ohio. Northwest Bancshares, Inc.'s common stock is listed on the NASDAQ Global Select Market ("NWBI"). Additional information regarding Northwest Bancshares, Inc. and Northwest Bank can be accessed on-line at www.northwest.com.

Forward-Looking Statements - This release may contain forward-looking statements with respect to the financial condition and results of operations of Northwest Bancshares, Inc. including, without limitations, statements relating to the earnings outlook of the Company. These forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements, include among others, the following possibilities: (1) changes in the interest rate environment; (2) competitive pressure among financial services companies; (3) general economic conditions including an increase in non-performing loans; (4) changes in legislation or regulatory requirements; (5) difficulties in continuing to improve operating efficiencies; (6) difficulties in the integration of acquired businesses or the ability to complete sales transactions; and (7) increased risk associated with commercial real-estate and business loans. Management has no obligation to revise or update these forward-looking statements to reflect events or circumstances that arise after the date of this release.

 

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Financial Condition (Unaudited)

(Dollars in thousands, except per share amounts)





June 30,

 2018



December 31,

 2017



June 30,

 2017

Assets











Cash and cash equivalents

$

133,045





77,710





156,767



Marketable securities available-for-sale (amortized cost of $814,848, $800,094 and $949,161,

respectively)

799,878





792,535





952,802



Marketable securities held-to-maturity (fair value of $25,212, $29,667 and $36,560, respectively)

25,747





29,678





36,206



Total cash and cash equivalents and marketable securities

958,670





899,923





1,145,775















Residential mortgage loans held for sale





3,128





10,297



Residential mortgage loans

2,800,668





2,773,075





2,740,174



Home equity loans

1,276,181





1,310,355





1,301,032



Consumer loans

700,925





671,389





658,125



Commercial real estate loans

2,553,223





2,454,726





2,396,663



Commercial loans

611,373





580,736





580,446



Total loans receivable

7,942,370





7,793,409





7,686,737



Allowance for loan losses

(57,332)





(56,795)





(62,885)



Loans receivable, net

7,885,038





7,736,614





7,623,852















Federal Home Loan Bank stock, at cost

7,887





11,733





8,142



Accrued interest receivable

24,959





23,352





21,667



Real estate owned, net

2,722





5,666





6,030



Premises and equipment, net

146,276





151,944





154,785



Bank owned life insurance

170,791





171,547





172,023



Goodwill

307,420





307,420





307,420



Other intangible assets

22,629





25,669





28,935



Other assets

35,917





30,066





30,381



Total assets

$

9,562,309





9,363,934





9,499,010















Liabilities and shareholders' equity











Liabilities











Noninterest-bearing demand deposits

$

1,732,664





1,610,409





1,577,562



Interest-bearing demand deposits

1,485,938





1,442,928





1,440,196



Money market deposit accounts

1,686,052





1,707,450





1,800,261



Savings deposits

1,697,396





1,653,579





1,685,282



Time deposits

1,405,328





1,412,623





1,467,946



Total deposits

8,007,378





7,826,989





7,971,247















Borrowed funds

99,889





108,238





110,441



Advances by borrowers for taxes and insurance

51,640





40,825





48,446



Accrued interest payable

568





460





530



Other liabilities

62,741





68,485





60,203



Junior subordinated debentures

111,213





111,213





111,213



Total liabilities

8,333,429





8,156,210





8,302,080















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, 103,122,890 shares,

102,394,828 shares and 102,478,146 shares issued and outstanding, respectively

1,031





1,027





1,025



Paid-in-capital

739,673





730,719





726,036



Retained earnings

531,269





508,058





495,017



Accumulated other comprehensive loss

(43,093)





(32,080)





(25,148)



Total shareholders' equity

1,228,880





1,207,724





1,196,930



Total liabilities and shareholders' equity

$

9,562,309





9,363,934





9,499,010















Equity to assets

12.85

%



12.90

%



12.60

%

Tangible common equity to assets

9.74

%



9.68

%



9.39

%

Book value per share

$

11.92





11.79





11.68



Tangible book value per share

$

8.72





8.54





8.40



Closing market price per share

$

17.39





16.73





15.61



Full time equivalent employees

2,118





2,106





2,273



Number of banking offices

172





172





173



 

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Income (Unaudited)

(Dollars in thousands, except per share amounts)





Quarter ended



June 30,



March 31,



December 31,



September 30,



June 30,



2018



2018



2017



2017



2017

Interest income:



















Loans receivable

$

88,106





85,220





87,154





85,373





84,714



Mortgage-backed securities

3,254





3,013





3,016





3,118





2,987



Taxable investment securities

648





678





805





957





981



Tax-free investment securities

313





390





449





476





529



FHLB dividends

85





97





78





63





50



Interest-earning deposits

469





135





59





244





536



Total interest income

92,875





89,533





91,561





90,231





89,797























Interest expense:



















Deposits

7,309





6,458





5,971





5,795





5,826



Borrowed funds

1,340





1,308





1,350





1,199





1,240



Total interest expense

8,649





7,766





7,321





6,994





7,066























Net interest income

84,226





81,767





84,240





83,237





82,731



Provision for loan losses

5,349





4,209





6,525





3,027





5,562



Net interest income after provision for loan losses

78,877





77,558





77,715





80,210





77,169























Noninterest income:



















Gain/ (loss) on sale of investments





153





(369)





1,497





3



Service charges and fees

12,908





11,899





12,527





12,724





12,749



Trust and other financial services income

4,050





4,031





4,290





4,793





4,600



Insurance commission income

2,090





2,749





1,874





1,992





2,353



Gain/ (loss) on real estate owned, net

176





(546)





(307)





(193)





(230)



Income from bank owned life insurance

2,333





990





2,295





1,078





1,652



Mortgage banking income

77





224





225





519





434



Gain on sale of offices

















17,186



Other operating income

2,475





2,288





2,370





2,184





2,730



Total noninterest income

24,109





21,788





22,905





24,594





41,477























Noninterest expense:



















Compensation and employee benefits

39,031





36,510





39,293





36,556





38,175



Premises and occupancy costs

6,824





7,307





7,293





6,951





7,103



Office operations

3,768





3,408





4,011





3,939





4,170



Collections expense

434





512





1,179





568





553



Processing expenses

9,560





9,706





9,888





9,650





9,639



Marketing expenses

2,014





2,140





2,125





2,488





2,846



Federal deposit insurance premiums

671





717





724





771





856



Professional services

2,819





2,277





2,945





2,321





2,452



Amortization of intangible assets

1,520





1,520





1,575





1,691





1,749



Real estate owned expense

133





292





195





310





217



Restructuring/ acquisition expense

393









164





1,398





2,634



Other expense

2,620





3,032





2,504





2,156





2,868



Total noninterest expense

69,787





67,421





71,896





68,799





73,262



Income before income taxes

33,199





31,925





28,724





36,005





45,384























Income tax expense

6,900





6,940





6,576





12,414





14,402



Net income

$

26,299





24,985





22,148





23,591





30,982























Basic earnings per share

$

0.26





0.25





0.22





0.23





0.31



Diluted earnings per share

$

0.25





0.24





0.22





0.23





0.30























Weighted average common shares outstanding - basic

101,870,043





101,598,928





101,293,307





101,163,534





100,950,772



Weighted average common shares outstanding - diluted

103,424,154





103,136,497





102,643,726





102,564,476





102,449,693























Annualized return on average equity

8.67

%



8.40

%



7.31

%



7.81

%



10.48

%

Annualized return on average assets

1.11

%



1.08

%



0.94

%



0.99

%



1.30

%

Annualized return on tangible common equity

11.74

%



11.47

%



10.05

%



10.74

%



14.44

%





















Efficiency ratio *

62.65

%



63.64

%



65.48

%



60.94

%



64.36

%

Annualized noninterest expense to average assets *

2.87

%



2.84

%



2.97

%



2.76

%



2.89

%















* Excludes gain on sale of offices, restructuring/ acquisition expenses, and amortization of intangible assets (non-GAAP).

 

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Income (Unaudited)

(Dollars in thousands, except per share amounts)





Six months ended June 30,



2018



2017

Interest income:







Loans receivable

$

173,326





167,465



Mortgage-backed securities

6,267





5,209



Taxable investment securities

1,326





1,987



Tax-free investment securities

703





1,098



FHLB dividends

182





109



Interest-earning deposits

604





1,196



Total interest income

182,408





177,064











Interest expense:







Deposits

13,767





11,291



Borrowed funds

2,648





2,465



Total interest expense

16,415





13,756











Net interest income

165,993





163,308



Provision for loan losses

9,558





10,199



Net interest income after provision for loan losses

156,435





153,109











Noninterest income:







Gain on sale of investments

153





20



Service charges and fees

24,807





24,466



Trust and other financial services income

8,081





8,904



Insurance commission income

4,839





5,147



Loss on real estate owned, net

(370)





(297)



Income from bank owned life insurance

3,323





2,720



Mortgage banking income

301





674



Gain on sale of offices





17,186



Other operating income

4,763





4,161



Total noninterest income

45,897





62,981











Noninterest expense:







Compensation and employee benefits

75,541





76,447



Premises and occupancy costs

14,131





14,619



Office operations

7,176





8,392



Collections expense

946





1,102



Processing expenses

19,266





19,548



Marketing expenses

4,154





4,994



Federal deposit insurance premiums

1,388





2,023



Professional services

5,096





5,027



Amortization of intangible assets

3,040





3,498



Real estate owned expense

425





499



Restructuring/ acquisition expense

393





2,857



Other expense

5,652





5,902



Total noninterest expense

137,208





144,908



Income before income taxes

65,124





71,182











Income tax expense

13,840





22,454



Net income

51,284





48,728











Basic earnings per share

$

0.50





0.48



Diluted earnings per share

$

0.50





0.48











Weighted average common shares outstanding - basic

101,735,235



100,798,209

Weighted average common shares outstanding - diluted

103,281,120



102,525,058









Annualized return on average equity

8.54

%



8.34

%

Annualized return on average assets

1.09

%



1.03

%

Annualized return on tangible common equity

11.51

%



11.42

%









Efficiency ratio *

63.13

%



66.26

%

Annualized noninterest expense to average assets *

2.85

%



2.92

%



* Excludes gain on sale of offices, restructuring/ acquisition expenses, and amortization of intangible assets (non-GAAP).

 

Northwest Bancshares, Inc. and Subsidiaries

Asset quality (Unaudited)

(Dollars in thousands)





June 30,

 2018



March 31,

 2018



December 31,

 2017



September 30,

 2017



June 30,

 2017

Nonaccrual loans current:



















Residential mortgage loans

$

669





123





70





318





841



Home equity loans

237





269





615





439





158



Consumer loans

218





178





317





260





379



Commercial real estate loans

14,814





11,355





10,080





10,646





16,189



Commercial loans

2,559





2,381





4,178





4,098





5,262



Total nonaccrual loans current

$

18,497





14,306





15,260





15,761





22,829























Nonaccrual loans delinquent 30 days to 59 days:



















Residential mortgage loans

$

89





1,290





509





200





181



Home equity loans

221





232





167





466





164



Consumer loans

192





224





239





200





169



Commercial real estate loans

522





975





1,928





597





474



Commercial loans

51





140





25









32



Total nonaccrual loans delinquent 30 days to 59 days

$

1,075





2,861





2,868





1,463





1,020























Nonaccrual loans delinquent 60 days to 89 days:



















Residential mortgage loans

$

668





755





703





892





896



Home equity loans

483





465





874





499





326



Consumer loans

194





224





500





405





342



Commercial real estate loans

1,682





399





1,104





5,895





2,233



Commercial loans

380





80





69





3







Total nonaccrual loans delinquent 60 days to 89 days

$

3,407





1,923





3,250





7,694





3,797























Nonaccrual loans delinquent 90 days or more:



















Residential mortgage loans

$

11,822





10,660





13,509





11,785





11,637



Home equity loans

6,729





6,707





7,251





6,295





5,744



Consumer finance loans

15





3





199





332





536



Consumer loans

2,626





2,931





3,617





3,244





2,273



Commercial real estate loans

15,617





16,145





15,361





22,583





21,295



Commercial loans

2,925





3,144





3,140





4,177





3,642



Total nonaccrual loans delinquent 90 days or more

$

39,734





39,590





43,077





48,416





45,127























Total nonaccrual loans

$

62,713





58,680





64,455





73,334





72,773























Total nonaccrual loans

$

62,713





58,680





64,455





73,334





72,773



Loans 90 days past maturity and still accruing

94





210





502





398





182



Nonperforming loans

62,807





58,890





64,957





73,732





72,955



Real estate owned, net

2,722





4,041





5,666





5,462





6,030



Nonperforming assets

$

65,529





62,931





70,623





79,194





78,985























Nonaccrual troubled debt restructuring *

$

10,860





11,217





12,285





17,809





17,873



Accruing troubled debt restructuring

19,802





19,749





19,819





20,660





23,987



Total troubled debt restructuring

$

30,662





30,966





32,104





38,469





41,860























Nonperforming loans to total loans

0.79

%



0.75

%



0.83

%



0.95

%



0.95

%

Nonperforming assets to total assets

0.69

%



0.66

%



0.75

%



0.84

%



0.83

%

Allowance for loan losses to total loans

0.72

%



0.70

%



0.73

%



0.74

%



0.82

%

Allowance for loan losses to nonperforming loans

91.28

%



93.75

%



87.43

%



77.16

%



86.20

%



* Amounts included in nonperforming loans above.

 

 Northwest Bancshares, Inc. and Subsidiaries

Loans by credit quality indicators (Unaudited)

(Dollars in thousands)



At June 30, 2018



Pass



Special mention

*



Substandard

**



Doubtful



Loss



Loans

receivable

Personal Banking:

























Residential mortgage loans



$

2,790,906









9,762













2,800,668



Home equity loans



1,268,884









7,297













1,276,181



Consumer loans



697,561









3,364













700,925



Total Personal Banking



4,757,351









20,423













4,777,774



Commercial Banking:

























Commercial real estate loans



2,294,327





65,698





193,198













2,553,223



Commercial loans



554,495





18,140





38,738













611,373



Total Commercial Banking



2,848,822





83,838





231,936













3,164,596



Total loans



$

7,606,173





83,838





252,359













7,942,370





























At March 31, 2018

























Personal Banking:

























Residential mortgage loans



$

2,755,078









17,070













2,772,148



Home equity loans



1,279,137









9,224













1,288,361



Consumer loans



682,433









3,605













686,038



Total Personal Banking



4,716,648









29,899













4,746,547



Commercial Banking:

























Commercial real estate loans



2,256,054





57,690





198,513













2,512,257



Commercial loans



557,613





19,147





46,703













623,463



Total Commercial Banking



2,813,667





76,837





245,216













3,135,720



Total loans



$

7,530,315





76,837





275,115













7,882,267





























At December 31, 2017

























Personal Banking:

























Residential mortgage loans



$

2,758,465









17,738













2,776,203



Home equity loans



1,300,277









10,078













1,310,355



Consumer loans



666,629









4,760













671,389



Total Personal Banking



4,725,371









32,576













4,757,947



Commercial Banking:

























Commercial real estate loans



2,216,326





83,537





154,863













2,454,726



Commercial loans



511,035





19,297





50,404













580,736



Total Commercial Banking



2,727,361





102,834





205,267













3,035,462



Total loans



$

7,452,732





102,834





237,843













7,793,409





























At September 30, 2017

























Personal Banking:

























Residential mortgage loans



$

2,725,060









18,166













2,743,226



Home equity loans



1,302,036









11,399













1,313,435



Consumer loans



669,532









4,388













673,920



Total Personal Banking



4,696,628









33,953













4,730,581



Commercial Banking:

























Commercial real estate loans



2,196,510





56,118





146,258













2,398,886



Commercial loans



526,824





18,924





50,923













596,671



Total Commercial Banking



2,723,334





75,042





197,181













2,995,557



Total loans



$

7,419,962





75,042





231,134













7,726,138





























At June 30, 2017

























Personal Banking:

























Residential mortgage loans



$

2,718,866









16,916













2,735,782



Home equity loans



1,307,022









8,699













1,315,721



Consumer loans



655,149









2,976













658,125



Total Personal Banking



4,681,037









28,591













4,709,628



Commercial Banking:

























Commercial real estate loans



2,178,996





67,826





149,841













2,396,663



Commercial loans



521,520





10,269





48,657













580,446



Total Commercial Banking



2,700,516





78,095





198,498













2,977,109



Total loans



$

7,381,553





78,095





227,089













7,686,737





Includes $9.5 million, $7.9 million, $8.6 million, $8.9 million, and $9.7 million of acquired loans at June 30, 2018, March 31, 2018, December 31, 2017, September 30, 2017, and 

June 30, 2017, respectively.

**

Includes $44.5 million, $45.2 million, $46.7 million, $48.2 million, and $44.8 million of acquired loans at June 30, 2018, March 31, 2018, December 31, 2017, September 30,

2017, and June 30, 2017, respectively.

 

Northwest Bancshares, Inc. and Subsidiaries

Loan delinquency (Unaudited)

(Dollars in thousands)







June 30,

2018



*



March 31,

2018



*



December 31,

2017



*



September 30,

2017



*



June 30,

2017



*

(Number of loans and dollar amount of loans)











































Loans delinquent 30 days to 59 days:











































Residential mortgage loans



30



$

1,561



0.1

%



319



$

27,403



1.0

%



317



$

25,784



0.9

%



44



$

2,771



0.1

%



64



$

2,893



0.1

%

Home equity loans



184



6,383



0.5

%



200



7,406



0.6

%



218



7,461



0.6

%



191



7,330



0.6

%



111



4,058



0.3

%

Consumer finance loans



306



711



8.1

%



477



1,288



10.3

%



849



2,128



11.4

%



1,045



3,065



11.4

%



581



1,785



4.1

%

Consumer loans



901



8,855



1.3

%



871



8,252



1.2

%



1,295



10,912



1.7

%



1,119



9,510



1.5

%



818



6,793



1.1

%

Commercial real estate loans



40



5,898



0.2

%



58



20,303



0.8

%



53



8,315



0.3

%



27



5,753



0.2

%



38



4,629



0.2

%

Commercial loans



24



1,000



0.2

%



35



2,912



0.5

%



26



1,865



0.3

%



16



746



0.1

%



20



1,378



0.2

%

Total loans delinquent 30 days to 59 days



1,485



$

24,408



0.3

%



1,960



$

67,564



0.9

%



2,758



$

56,465



0.7

%



2,442



$

29,175



0.4

%



1,632



$

21,536



0.3

%





















































Loans delinquent 60 days to 89 days:



















































Residential mortgage loans



62



$

5,847



0.2

%



21



$

1,943



0.1

%



75



$

6,235



0.2

%



84



$

7,196



0.3

%



72



$

6,320



0.2

%

Home equity loans



73



2,495



0.2

%



52



2,040



0.2

%



72



2,871



0.2

%



73



2,390



0.2

%



44



1,522



0.1

%

Consumer finance loans



127



277



3.2

%



109



233



1.9

%



412



1,113



6.0

%



831



2,190



8.1

%



276



759



1.7

%

Consumer loans



350



2,654



0.4

%



296



2,259



0.3

%



463



3,351



0.5

%



473



3,283



0.5

%



347



2,475



0.4

%

Commercial real estate loans



28



3,689



0.1

%



23



1,809



0.1

%



25



2,539



0.1

%



22



7,666



0.3

%



14



3,368



0.1

%

Commercial loans



15



926



0.2

%



7



196



%



10



441



0.1

%



9



196



%



9



199



%

Total loans delinquent 60 days to 89 days



655



$

15,888



0.2

%



508



$

8,480



0.1

%



1,057



$

16,550



0.2

%



1,492



$

22,921



0.3

%



762



$

14,643



0.2

%





















































Loans delinquent 90 days or more: **



















































Residential mortgage loans



140



$

12,293



0.4

%



127



$

10,791



0.4

%



158



$

13,890



0.5

%



143



$

12,190



0.4

%



145



$

12,053



0.4

%

Home equity loans



154



6,768



0.5

%



148



6,750



0.5

%



177



7,349



0.6

%



150



6,397



0.5

%



126



5,800



0.4

%

Consumer finance loans



8



15



0.2

%



7



3



%



74



199



1.1

%



124



332



1.2

%



188



536



1.2

%

Consumer loans



302



2,633



0.4

%



659



2,939



0.4

%



719



3,627



0.6

%



428



3,254



0.5

%



299



2,285



0.4

%

Commercial real estate loans



113



15,772



0.6

%



106



16,723



0.7

%



109



16,284



0.7

%



113



23,310



1.0

%



108



22,044



0.9

%

Commercial loans



31



2,925



0.5

%



35



3,144



0.5

%



37



3,140



0.5

%



45



4,177



0.7

%



39



3,642



0.6

%

Total loans delinquent 90 days or more



748



$

40,406



0.5

%



1,082



$

40,350



0.5

%



1,274



$

44,489



0.6

%



1,003



$

49,660



0.6

%



905



$

46,360



0.6

%





















































Total loans delinquent



2,888



$

80,702



1.0

%



3,550



$

116,394



1.5

%



5,089



$

117,504



1.5

%



4,937



$

101,756



1.3

%



3,299



$

82,539



1.1

%



*  

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

** 

Includes purchased credit impaired loans of $672,000, $760,000, $1.4 million, $1.2 million, and $1.2 million at June 30, 2018, March 31, 2018, December 31, 2017, September 30, 2017 and June 30, 2017,

respectively.

 

Northwest Bancshares, Inc. and Subsidiaries

Allowance for loan losses (Unaudited)

(Dollars in thousands)







Quarter ended



June 30,

 2018



March 31,

 2018



December 31,

 2017



September 30,

 2017



June 30,

 2017

Beginning balance

$

55,211





56,795





56,927





62,885





61,104



Provision

5,349





4,209





6,525





3,027





5,562



Charge-offs residential mortgage

(389)





(201)





(162)





(215)





(372)



Charge-offs home equity

(406)





(611)





(393)





(528)





(689)



Charge-offs consumer finance

(486)





(1,553)





(2,900)





(3,891)





(782)



Charge-offs consumer

(2,682)





(3,249)





(3,322)





(3,002)





(2,735)



Charge-offs commercial real estate

(439)





(551)





(1,470)





(1,901)





(329)



Charge-offs commercial

(491)





(1,025)





(785)





(509)





(929)



Recoveries

1,665





1,397





2,375





1,061





2,055



Ending balance

$

57,332





55,211





56,795





56,927





62,885























Net charge-offs to average loans, annualized

0.16

%



0.30

%



0.34

%



0.47

%



0.20

%

 



Six months ended June 30,



2018



2017

Beginning balance

$

56,795





60,939



Provision

9,558





10,199



Charge-offs residential mortgage

(590)





(662)



Charge-offs home equity

(1,017)





(1,338)



Charge-offs consumer finance

(2,039)





(1,578)



Charge-offs consumer

(5,931)





(5,599)



Charge-offs commercial real estate

(990)





(803)



Charge-offs commercial

(1,516)





(2,196)



Recoveries

3,062





3,923



Ending balance

$

57,332





62,885











Net charge-offs to average loans, annualized

0.23

%



0.22

%

 



June 30, 2018



Originated loans



Acquired loans



Total loans



Balance



Reserve



Balance



Reserve



Balance



Reserve

Residential mortgage loans

$

2,696,660



3,657



104,008



170



2,800,668



3,827

Home equity loans

1,040,988



3,839



235,193



662



1,276,181



4,501

Legacy consumer finance loans

8,724



2,354







8,724



2,354

Consumer loans

617,074



9,760



75,127



915



692,201



10,675

Personal Banking Loans

4,363,446



19,610



414,328



1,747



4,777,774



21,357





















Commercial real estate loans

2,291,027



21,019



262,196



3,422



2,553,223



24,441

Commercial loans

555,627



10,509



55,746



1,025



611,373



11,534

Commercial Banking Loans

2,846,654



31,528



317,942



4,447



3,164,596



35,975



















Total Loans

$

7,210,100



51,138



732,270



6,194



7,942,370



57,332

 

 

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, 2018



March 31, 2018



December 31, 2017



September 30, 2017



June 30, 2017



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

$

2,761,528





27,893





4.04

%



$

2,756,142





27,973





4.12

%



$

2,746,992





28,373





4.13

%



$

2,732,546





28,279





4.14

%



$

2,721,445





28,245





4.15

%

Home equity loans

1,281,001





15,384





4.82

%



1,298,780





14,786





4.62

%



1,312,146





15,187





4.59

%



1,299,473





14,694





4.49

%



1,311,274





14,344





4.39

%

Consumer loans

655,541





7,949





4.86

%



637,691





7,450





4.74

%



633,023





8,004





5.02

%



617,754





7,627





4.90

%



595,170





7,405





4.99

%

Consumer finance loans

10,428





516





19.79

%



15,254





768





20.14

%



22,469





1,151





20.32

%



33,469





1,433





17.13

%



40,945





2,110





20.61

%

Commercial real estate loans

2,518,170





29,034





4.56

%



2,471,422





27,384





4.43

%



2,442,528





28,251





4.53

%



2,389,969





27,234





4.46

%



2,430,594





27,071





4.41

%

Commercial loans

624,087





7,703





4.88

%



595,276





7,160





4.81

%



588,420





6,739





4.48

%



593,143





6,659





4.39

%



554,506





6,087





4.34

%

Total loans receivable (a) (b) (d)

7,850,755





88,479





4.52

%



7,774,565





85,521





4.46

%



7,745,578





87,705





4.49

%



7,666,354





85,926





4.45

%



7,653,934





85,262





4.47

%

Mortgage-backed securities (c)

569,893





3,255





2.28

%



558,055





3,013





2.16

%



581,055





3,016





2.08

%



607,454





3,118





2.05

%



592,917





2,987





2.02

%

Investment securities (c) (d)

235,784





1,044





1.77

%



256,287





1,172





1.83

%



301,268





1,495





1.98

%



352,813





1,690





1.92

%



372,398





1,796





1.93

%

FHLB stock

7,819





85





4.36

%



9,354





97





4.21

%



10,066





78





3.07

%



7,748





63





3.23

%



7,602





50





2.64

%

Other interest-earning deposits

103,739





469





1.79

%



34,200





135





1.58

%



13,515





59





1.71

%



71,482





243





1.33

%



208,141





536





1.02

%

Total interest-earning assets

8,767,990





93,332





4.27

%



8,632,461





89,938





4.23

%



8,651,482





92,353





4.24

%



8,705,851





91,040





4.15

%



8,834,992





90,631





4.11

%

Noninterest earning assets (e)

732,065













779,812













709,753













755,026













716,913











Total assets

$

9,500,055













$

9,412,273













$

9,361,235













$

9,460,877













$

9,551,905







































































Liabilities and shareholders' equity:



























































Interest-bearing liabilities:



























































Savings deposits

$

1,699,168





773





0.18

%



$

1,670,491





749





0.18

%



$

1,655,798





763





0.18

%



$

1,681,777





776





0.18

%



$

1,714,290





768





0.18

%

Interest-bearing demand deposits

1,468,228





875





0.24

%



1,419,459





603





0.17

%



1,419,352





331





0.09

%



1,435,143





297





0.08

%



1,451,787





283





0.08

%

Money market deposit accounts

1,691,652





1,211





0.29

%



1,706,800





1,053





0.25

%



1,734,444





1,017





0.23

%



1,789,082





1,048





0.23

%



1,839,693





1,064





0.23

%

Time deposits

1,440,457





4,450





1.24

%



1,415,247





4,053





1.16

%



1,421,569





3,860





1.08

%



1,449,830





3,674





1.01

%



1,518,650





3,711





0.98

%

Borrowed funds (f)

104,415





50





0.19

%



133,231





124





0.38

%



159,599





187





0.46

%



106,282





49





0.18

%



126,685





55





0.17

%

Junior subordinated debentures

111,213





1,290





4.59

%



111,213





1,184





4.26

%



111,213





1,163





4.09

%



111,213





1,150





4.05

%



111,213





1,185





4.22

%

Total interest-bearing liabilities

6,515,133





8,649





0.53

%



6,456,441





7,766





0.49

%



6,501,975





7,321





0.45

%



6,573,327





6,994





0.42

%



6,762,318





7,066





0.42

%

Noninterest-bearing demand deposits (g)

1,676,344













1,606,247













1,599,834













1,573,112













1,544,953











Noninterest bearing liabilities

92,252













143,608













57,956













116,021













59,277











Total liabilities

8,283,729













8,206,296













8,159,765













8,262,460













8,366,548











Shareholders' equity

1,216,326













1,205,977













1,201,470













1,198,417













1,185,357











Total liabilities and shareholders' equity

$

9,500,055













$

9,412,273













$

9,361,235













$

9,460,877













$

9,551,905











Net interest income/ Interest rate spread





84,683





3.74

%







82,172





3.74

%







85,032





3.79

%







84,046





3.73

%







83,565





3.69

%

Net interest-earning assets/ Net interest margin

$

2,252,857









3.86

%



$

2,176,020









3.86

%



$

2,149,507









3.93

%



$

2,132,524









3.86

%



$

2,072,674









3.78

%

Ratio of interest-earning assets to interest-bearing liabilities

1.35X













1.34X













1.33X













1.32X













1.31X







































































(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 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 0.37%, 0.33%, 0.30%, 0.29 % and 0.29%, respectively.

(h) 

Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 4.50%, 4.45%, 4.46%, 4.42%, and 4.44%, respectively, Investment securities - 1.63%, 1.67%, 1.66%, 1.62%, and 1.62%, respectively, Interest-earning assets - 4.25%, 4.21%, 4.20%, 4.11%,

and 4.08%, respectively. GAAP basis net interest rate spreads were 3.72 %, 3.72%, 3.75%, 3.69%,  and 3.66%, respectively, and GAAP basis net interest margins were 3.84%, 3.84%, 3.89%, 3.82%, and 3.75%, respectively.



 

 

 

Northwest Bancshares, Inc. and Subsidiaries

Average balance sheet (Unaudited)

(Dollars in thousands)



The following table sets forth certain information relating to the Company's average balance sheet and reflects the average yield on assets and average cost of liabilities for the periods indicated.  Such yields and costs are derived by dividing income or expense by the average balance of assets or liabilities, respectively,

for the periods presented.  Average balances are calculated using daily averages.





Six months ended June 30,



2018



2017



Average

balance



Interest



Avg.

yield/

cost (h)



Average

balance



Interest



Avg.

yield/

cost (h)

Assets:























Interest-earning assets:























Residential mortgage loans

$

2,758,849





55,612





4.03

%



$

2,720,180





55,554





4.08

%

Home equity loans

1,289,842





30,369





4.75

%



1,321,902





28,545





4.35

%

Consumer loans

646,666





15,451





4.82

%



588,043





14,623





5.01

%

Consumer finance loans

12,828





1,284





20.02

%



43,683





4,593





21.03

%

Commercial real estate loans

2,494,925





56,214





4.48

%



2,443,262





53,633





4.37

%

Commercial loans

609,752





15,070





4.92

%



538,760





11,602





4.28

%

Loans receivable (a) (b) (d)

7,812,862





174,000





4.49

%



7,655,830





168,550





4.44

%

Mortgage-backed securities (c)

564,007





6,268





2.22

%



532,631





5,209





1.96

%

Investment securities (c) (d)

245,979





2,216





1.80

%



375,093





3,677





1.96

%

FHLB stock

8,582





182





4.28

%



7,454





109





2.95

%

Other interest-earning deposits

68,970





604





1.74

%



257,427





1,196





0.92

%

Total interest-earning assets

8,700,400





183,270





4.25

%



8,828,435





178,741





4.08

%

Noninterest earning assets (e)

755,764













751,774











Total assets

$

9,456,164













$

9,580,209



































Liabilities and shareholders' equity:























Interest-bearing liabilities:























Savings deposits

$

1,684,909





1,522





0.18

%



$

1,708,441





1,524





0.18

%

Interest-bearing demand deposits

1,443,981





1,477





0.21

%



1,437,112





399





0.06

%

Money market deposit accounts

1,699,222





2,264





0.27

%



1,859,383





2,138





0.23

%

Time deposits

1,427,921





8,504





1.20

%



1,545,959





7,230





0.94

%

Borrowed funds (f)

118,743





173





0.29

%



131,750





112





0.17

%

Junior subordinated debentures

111,213





2,475





4.43

%



111,213





2,353





4.21

%

Total interest-bearing liabilities

6,485,989





16,415





0.51

%



6,793,858





13,756





0.41

%

Noninterest-bearing demand deposits (g)

1,641,493













1,525,723











Noninterest bearing liabilities

117,530













82,997











Total liabilities

8,245,012













8,402,578











Shareholders' equity

1,211,152













1,177,631











Total liabilities and shareholders' equity

$

9,456,164













$

9,580,209











Net interest income/ Interest rate spread





166,855





3.74

%







164,985





3.67

%

Net interest-earning assets/ Net interest margin

$

2,214,411









3.84

%



$

2,034,577









3.74

%

Ratio of interest-earning assets to interest-

bearing liabilities

1.34X













1.30X



































(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 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 0.35% and 0.28%, respectively.

(h)

Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 4.47% and 4.41%, respectively, Investment securities - 1.65%

and 1.64%, respectively, Interest-earning assets - 4.23% and 4.04%, respectively. GAAP basis net interest rate spreads were 3.72% and 3.64%,

respectively, and GAAP basis net interest margins were 3.82% and 3.70%, respectively.

 

Cision View original content with multimedia:http://www.prnewswire.com/news-releases/northwest-bancshares-inc-announces-second-quarter-2018-earnings-and-quarterly-dividend-300684280.html

SOURCE Northwest Bancshares, Inc.

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