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

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

PR Newswire

WARREN, Pa., July 23, 2018 /PRNewswire/ -- Northwest Bancshares, Inc. (NASDAQ: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