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

Company Release - 4/18/2018 9:00 AM ET

WARREN, Pa., April 18, 2018 /PRNewswire/ -- Northwest Bancshares, Inc. (NasdaqGS: NWBI) announced net income for the quarter ended March 31, 2018 of $25.0 million, or $0.24 per diluted share. This represents an increase of $7.3 million, or 40.8%, compared to the same quarter last year when net income was $17.7 million or $0.17 per diluted share. The annualized returns on average shareholders' equity and average assets for the quarter ended March 31, 2018 were 8.40% and 1.08% compared to 6.15% and 0.75% 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 May 17, 2018, to shareholders of record as of May 3, 2018. This is the 94th consecutive quarter in which the Company has paid a cash dividend. Based on the market value of the Company's stock as of March 31, 2018, this represents an annualized dividend yield of approximately 4.1%.

In making this announcement, William J. Wagner, Chairman and CEO, noted, "We are pleased that the strategies employed over the past two years to simplify our business model and focus on our core competencies had a noticeable impact on our first quarter operating results. Primarily as a result of the divestiture last year of both our Maryland offices and retirement services business, combined with the closure of our consumer finance subsidiary, operating expenses in the first quarter of 2018 decreased $4.2 million or almost 6% over the previous year. With a greater focus on our core competencies of lending and deposit gathering, we were pleased to realize net loan growth in the first quarter of $88.9 million, or 4.4% on an annualized basis. In addition, deposits grew this quarter by $158.5 million, or 8.1%, on an annualized basis, with $102.7 million of that growth coming from checking accounts. Finally, due primarily to the combined decreases in operating expenses and income taxes, with the latter attributable to the Tax Cuts and Jobs Act in December 2017, our annualized return on assets for the quarter was 1.08%, the first time in recent history that core earnings exceeded 1.00% of assets."

Net interest income increased by $1.2 million, or 1.5%, to $81.8 million for the quarter ended March 31, 2018, from $80.6 million for the quarter ended March 31, 2017. This increase is due primarily to a $2.4 million, or 3.0%, increase in interest income on loans receivable and a $791,000, or 35.6%, increase in interest income on mortgage-backed securities. These increases were primarily the result of increases in the average balance of loans receivable and mortgage-backed securities of $116.8 million and $86.4 million, respectively. Additionally, the average yield on loans receivable and mortgage-backed securities increased by seven and 28 basis points, respectively. Partially offsetting these improvements was an increase in interest expense on deposits of $993,000, or 18.2%, due to the recent increase 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 March 31, 2018 from 3.62% for the same quarter last year.

The provision for loan losses decreased by $428,000, or 9.2%, to $4.2 million for the quarter ended March 31, 2018, from $4.6 million for the quarter ended March 31, 2017. This decrease is due primarily to the improvement in the historical loss rates for commercial loans when compared to last year. Additionally, reserves in the first half of 2017 were elevated in connection with the closure of the Company's consumer finance subsidiary. Also, total nonaccrual loans decreased to $58.7 million, or 0.74% of total loans at March 31, 2018 from $73.3 million, or 0.97% of total loans, at March 31, 2017.

Noninterest income increased by $284,000, or 1.3%, to $21.8 million for the quarter ended March 31, 2018, from $21.5 million for the quarter ended March 31, 2017. Contributing to this increase was an increase in other operating income of $857,000, or 59.9%, which is primarily attributable to the growth in fee income associated with commercial lending activity. Partially offsetting this improvement was an increase in loss on real estate owned of $479,000, or 714.9%, to $546,000 for the current quarter compared to $67,000 for the prior year's quarter, primarily as a result of the sale of one commercial property.

Noninterest expense decreased by $4.2 million, or 5.9%, to $67.4 million for the quarter ended March 31, 2018, from $71.6 million for the quarter ended March 31, 2017. This decrease resulted primarily from a $1.8 million, or 4.6%, decrease in compensation and employee benefits due primarily to restructuring that occurred during 2017, including the closure of the Company's consumer finance subsidiary and the sale of the Company's three Maryland offices and retirement services business. Additionally, office operations decreased by $814,000, or 19.3%, due primarily to internal initiatives designed to reduce customer fraud related losses.

Income tax expense decreased by $1.2 million, or 13.8%, despite an increase in income before taxes of $6.1 million, or 23.7%. 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 21.7% for the quarter ended March 31, 2018 from 31.2% for last year's quarter.

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)



March 31,
 2018


December 31,
 2017


March 31,
 2017

Assets






Cash and cash equivalents

$

192,158



77,710



431,948


Marketable securities available-for-sale (amortized cost of $771,110, $800,094 and $874,446, respectively)

757,976



792,535



876,047


Marketable securities held-to-maturity (fair value of $27,324, $29,667 and $42,285, respectively)

27,709



29,678



41,888


Total cash and cash equivalents and marketable securities

977,843



899,923



1,349,883








Residential mortgage loans held for sale



3,128



1,595


Residential mortgage loans

2,772,148



2,773,075



2,704,474


Home equity loans

1,288,361



1,310,355



1,305,394


Consumer loans

686,038



671,389



643,105


Commercial real estate loans

2,512,257



2,454,726



2,378,474


Commercial loans

623,463



580,736



530,046


Total loans receivable

7,882,267



7,793,409



7,563,088


Allowance for loan losses

(55,211)



(56,795)



(61,104)


Loans receivable, net

7,827,056



7,736,614



7,501,984








Assets held-for-sale





150,940


Federal Home Loan Bank stock, at cost

7,694



11,733



7,362


Accrued interest receivable

23,051



23,352



20,945


Real estate owned, net

4,041



5,666



6,242


Premises and Equipment, net

148,184



151,944



159,823


Bank owned life insurance

172,537



171,547



172,516


Goodwill

307,420



307,420



307,420


Other intangible assets

24,149



25,669



30,684


Other assets

29,004



30,066



23,724


Total assets

$

9,520,979



9,363,934



9,731,523








Liabilities and Shareholders' equity






Liabilities






Noninterest-bearing demand deposits

$

1,679,853



1,610,409



1,530,026


Interest-bearing demand deposits

1,476,177



1,442,928



1,448,503


Money market deposit accounts

1,707,837



1,707,450



1,827,028


Savings deposits

1,701,022



1,653,579



1,685,103


Time deposits

1,420,600



1,412,623



1,495,095


Total deposits

7,985,489



7,826,989



7,985,755








Liabilities held-for-sale





220,627


Borrowed funds

104,558



108,238



137,191


Advances by borrowers for taxes and insurance

43,654



40,825



40,470


Accrued interest payable

528



460



586


Other liabilities

60,283



68,485



58,118


Junior subordinated debentures

111,213



111,213



111,213


Total liabilities

8,305,725



8,156,210



8,553,960








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, 102,599,662 shares, 102,394,828 shares and 101,987,942 shares issued and outstanding, respectively

1,026



1,027



1,020


Paid-in-capital

734,065



730,719



723,055


Retained earnings

522,384



508,058



480,309


Accumulated other comprehensive loss

(42,221)



(32,080)



(26,821)


Total shareholders' equity

1,215,254



1,207,724



1,177,563


Total liabilities and shareholders' equity

$

9,520,979



9,363,934



9,731,523








Equity to assets

12.76

%


12.90

%


12.10

%

Tangible common equity to assets

9.62

%


9.68

%


8.94

%

Book value per share

$

11.84



11.79



11.55


Tangible book value per share

$

8.61



8.54



8.23


Closing market price per share

$

16.56



16.73



16.84


Full time equivalent employees

2,105



2,106



2,328


Number of banking offices

172



172



176



 

 

Northwest Bancshares, Inc. and Subsidiaries
Consolidated Statements of Income (Unaudited)
(Dollars in thousands, except per share amounts)



Quarter ended


March 31,


December 31,


September 30,


June 30,


March  31,


2018


2017


2017


2017


2017

Interest income:










Loans receivable

$

85,220



87,154



85,373



84,714



82,751


Mortgage-backed securities

3,013



3,016



3,118



2,987



2,222


Taxable investment securities

678



805



957



981



1,006


Tax-free investment securities

390



449



476



529



569


FHLB dividends

97



78



63



50



59


Interest-earning deposits

135



59



244



536



660


Total interest income

89,533



91,561



90,231



89,797



87,267












Interest expense:










Deposits

6,458



5,971



5,795



5,826



5,465


Borrowed funds

1,308



1,350



1,199



1,240



1,225


Total interest expense

7,766



7,321



6,994



7,066



6,690












Net interest income

81,767



84,240



83,237



82,731



80,577


Provision for loan losses

4,209



6,525



3,027



5,562



4,637


Net interest income after provision for loan losses

77,558



77,715



80,210



77,169



75,940












Noninterest income:










Gain/ (loss) on sale of investments

153



(369)



1,497



3



17


Service charges and fees

11,899



12,527



12,724



12,749



11,717


Trust and other financial services income

4,031



4,290



4,793



4,600



4,304


Insurance commission income

2,749



1,874



1,992



2,353



2,794


Loss on real estate owned, net

(546)



(307)



(193)



(230)



(67)


Income from bank owned life insurance

990



2,295



1,078



1,652



1,068


Mortgage banking income

224



225



519



434



240


Gain on sale of offices







17,186




Other operating income

2,288



2,370



2,184



2,730



1,431


Total noninterest income

21,788



22,905



24,594



41,477



21,504












Noninterest expense:










Compensation and employee benefits

36,510



39,293



36,556



38,175



38,272


Premises and occupancy costs

7,307



7,293



6,951



7,103



7,516


Office operations

3,408



4,011



3,939



4,170



4,222


Collections expense

512



1,179



568



553



549


Processing expenses

9,706



9,888



9,650



9,639



9,909


Marketing expenses

2,140



2,125



2,488



2,846



2,148


Federal deposit insurance premiums

717



724



771



856



1,167


Professional services

2,277



2,945



2,321



2,452



2,575


Amortization of intangible assets

1,520



1,575



1,691



1,749



1,749


Real estate owned expense

292



195



310



217



282


Restructuring/ acquisition expense



164



1,398



2,634



223


Other expense

3,032



2,504



2,156



2,868



3,034


Total noninterest expense

67,421



71,896



68,799



73,262



71,646


Income before income taxes

31,925



28,724



36,005



45,384



25,798












Income tax expense

6,940



6,576



12,414



14,402



8,052


Net income

$

24,985



22,148



23,591



30,982



17,746












Basic earnings per share

$

0.25



0.22



0.23



0.31



0.18


Diluted earnings per share

$

0.24



0.22



0.23



0.30



0.17












Weighted average common shares outstanding - basic

101,598,928



101,293,307



101,163,534



100,950,772



100,653,277


Weighted average common shares outstanding - diluted

103,136,497



102,643,726



102,564,476



102,449,693



102,480,549












Annualized return on average equity

8.40

%


7.31

%


7.81

%


10.48

%


6.15

%

Annualized return on average assets

1.08

%


0.94

%


0.99

%


1.30

%


0.75

%

Annualized return on tangible common equity

11.47

%


10.05

%


10.74

%


14.44

%


8.57

%











Efficiency ratio *

63.64

%


65.48

%


60.94

%


64.36

%


68.25

%

Annualized noninterest expense to average assets *

2.84

%


2.97

%


2.76

%


2.89

%


2.94

%

* 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)  
 



March 31,
 2018


December 31,
 2017


September 30,
 2017


June 30,
 2017


March 31,
 2017

Nonaccrual loans current:










Residential mortgage loans

$

123



70



318



841



1,864


Home equity loans

269



615



439



158



1,244


Consumer loans

178



317



260



379



633


Commercial real estate loans

11,355



10,080



10,646



16,189



13,347


Commercial loans

2,381



4,178



4,098



5,262



5,335


Total nonaccrual loans current

$

14,306



15,260



15,761



22,829



22,423












Nonaccrual loans delinquent 30 days to 59 days:










Residential mortgage loans

$

1,290



509



200



181



1,001


Home equity loans

232



167



466



164



328


Consumer loans

224



239



200



169



218


Commercial real estate loans

975



1,928



597



474



1,970


Commercial loans

140



25





32



328


Total nonaccrual loans delinquent 30 days to 59 days

$

2,861



2,868



1,463



1,020



3,845












Nonaccrual loans delinquent 60 days to 89 days:










Residential mortgage loans

$

755



703



892



896



704


Home equity loans

465



874



499



326



408


Consumer loans

224



500



405



342



242


Commercial real estate loans

399



1,104



5,895



2,233



540


Commercial loans

80



69



3





23


Total nonaccrual loans delinquent 60 days to 89 days

$

1,923



3,250



7,694



3,797



1,917












Nonaccrual loans delinquent 90 days or more:










Residential mortgage loans

$

10,660



13,509



11,785



11,637



11,911


Home equity loans

6,707



7,251



6,295



5,744



6,194


Consumer finance loans

3



199



332



536



471


Consumer loans

2,931



3,617



3,244



2,273



2,888


Commercial real estate loans

16,145



15,361



22,583



21,295



20,897


Commercial loans

3,144



3,140



4,177



3,642



2,744


Total nonaccrual loans delinquent 90 days or more

$

39,590



43,077



48,416



45,127



45,105












Total nonaccrual loans

$

58,680



64,455



73,334



72,773



73,290












Total nonaccrual loans

$

58,680



64,455



73,334



72,773



73,290


Loans 90 days past maturity and still accruing

210



502



398



182



265


Nonperforming loans

58,890



64,957



73,732



72,955



73,555


Real estate owned, net

4,041



5,666



5,462



6,030



6,242


Nonperforming assets

$

62,931



70,623



79,194



78,985



79,797












Nonaccrual troubled debt restructuring *

$

11,217



12,285



17,809



17,873



18,273


Accruing troubled debt restructuring

19,749



19,819



20,660



23,987



25,305


Total troubled debt restructuring

$

30,966



32,104



38,469



41,860



43,578












Nonperforming loans to total loans

0.75

%


0.83

%


0.95

%


0.95

%


0.97

%

Nonperforming assets to total assets

0.66

%


0.75

%


0.84

%


0.83

%


0.82

%

Allowance for loan losses to total loans

0.70

%


0.73

%


0.74

%


0.82

%


0.81

%

Allowance for loan losses to nonperforming loans

93.75

%


87.43

%


77.16

%


86.20

%


83.07

%

 * Amounts included in nonperforming loans above.

 

Northwest Bancshares, Inc. and Subsidiaries
Loans by credit quality indicators (Unaudited)
(Dollars in thousands)


At March 31, 2018


Pass


Special

mention *


Substandard
**


Doubtful


Loss


Loans

receivable

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















At March 31, 2017













Personal Banking:













Residential mortgage loans


$

2,673,678





16,866







2,690,544


Home equity loans


1,311,707





9,212







1,320,919


Consumer loans


639,574





3,531







643,105


Total Personal Banking


4,624,959





29,609







4,654,568


Commercial Banking:













Commercial real estate loans


2,187,545



48,189



142,740







2,378,474


Commercial loans


474,662



12,226



43,158







530,046


Total Commercial Banking


2,662,207



60,415



185,898







2,908,520


Total loans


$

7,287,166



60,415



215,507







7,563,088


* Includes $7.9 million $8.6 million, $8.9 million, $9.7 million, and $12.4 million of acquired loans at March 31, 2018, December 31, 2017, September 30, 2017, June 30, 2017, and March 31, 2017, respectively.
** Includes $45.2 million, $46.7 million, $48.2 million, $44.8 million, and $45.3 million of acquired loans at March 31, 2018, December 31, 2017, September 30, 2017, June 30, 2017, and March 31, 2017, respectively.

 

Northwest Bancshares, Inc. and Subsidiaries
Loan delinquency (Unaudited)
(Dollars in thousands)




March 31,

2018


*


December 31,
2017


*


September 30,

2017


*


June 30,
2017


*


March 31,
2017


*

(Number of loans and dollar amount of loans)































Loans delinquent 30 days to 59 days:































Residential mortgage loans


319



$

27,403



1.0

%


317



$

25,784



0.9

%


44



$

2,771



0.1

%


64



$

2,893



0.1

%


280



$

22,254



0.8

%

Home equity loans


200



7,406



0.6

%


218



7,461



0.6

%


191



7,330



0.6

%


111



4,058



0.3

%


125



4,586



0.4

%

Consumer finance loans


477



1,288



10.3

%


849



2,128



11.4

%


1,045



3,065



11.4

%


581



1,785



4.1

%


308



947



1.8

%

Consumer loans


871



8,252



1.2

%


1,295



10,912



1.7

%


1,119



9,510



1.5

%


818



6,793



1.1

%


714



6,210



1.1

%

Commercial real estate loans


58



20,303



0.8

%


53



8,315



0.3

%


27



5,753



0.2

%


38



4,629



0.2

%


60



9,364



0.4

%

Commercial loans


35



2,912



0.5

%


26



1,865



0.3

%


16



746



0.1

%


20



1,378



0.2

%


29



2,304



0.4

%

Total loans delinquent 30 days to 59 days


1,960



$

67,564



0.9

%


2,758



$

56,465



0.7

%


2,442



$

29,175



0.4

%


1,632



$

21,536



0.3

%


1,516



$

45,665



0.6

%
































Loans delinquent 60 days to 89 days:































Residential mortgage loans


21



$

1,943



0.1

%


75



$

6,235



0.2

%


84



$

7,196



0.3

%


72



$

6,320



0.2

%


28



$

1,594



0.1

%

Home equity loans


52



2,040



0.2

%


72



2,871



0.2

%


73



2,390



0.2

%


44



1,522



0.1

%


36



1,145



0.1

%

Consumer finance loans


109



233



1.9

%


412



1,113



6.0

%


831



2,190



8.1

%


276



759



1.7

%


164



475



0.9

%

Consumer loans


296



2,259



0.3

%


463



3,351



0.5

%


473



3,283



0.5

%


347



2,475



0.4

%


266



1,766



0.3

%

Commercial real estate loans


23



1,809



0.1

%


25



2,539



0.1

%


22



7,666



0.3

%


14



3,368



0.1

%


19



3,034



0.1

%

Commercial loans


7



196



%


10



441



0.1

%


9



196



%


9



199



%


10



499



0.1

%

Total loans delinquent 60 days to 89 days


508



$

8,480



0.1

%


1,057



$

16,550



0.2

%


1,492



$

22,921



0.3

%


762



$

14,643



0.2

%


523



$

8,513



0.1

%
































Loans delinquent 90 days or more: **































Residential mortgage loans


127



$

10,791



0.4

%


158



$

13,890



0.5

%


143



$

12,190



0.4

%


145



$

12,053



0.4

%


139



$

12,326



0.5

%

Home equity loans


148



6,750



0.5

%


177



7,349



0.6

%


150



6,397



0.5

%


126



5,800



0.4

%


143



6,258



0.5

%

Consumer finance loans


7



3



%


74



199



1.1

%


124



332



1.2

%


188



536



1.2

%


169



471



0.9

%

Consumer loans


659



2,939



0.4

%


719



3,627



0.6

%


428



3,254



0.5

%


299



2,285



0.4

%


363



2,901



0.5

%

Commercial real estate loans


106



16,723



0.7

%


109



16,284



0.7

%


113



23,310



1.0

%


108



22,044



0.9

%


106



23,009



1.0

%

Commercial loans


35



3,144



0.5

%


37



3,140



0.5

%


45



4,177



0.7

%


39



3,642



0.6

%


39



2,744



0.5

%

Total loans delinquent 90 days or more


1,082



$

40,350



0.5

%


1,274



$

44,489



0.6

%


1,003



$

49,660



0.6

%


905



$

46,360



0.6

%


959



$

47,709



0.6

%
































Total loans delinquent


3,550



$

116,394



1.5

%


5,089



$

117,504



1.5

%


4,937



$

101,756



1.3

%


3,299



$

82,539



1.1

%


2,998



$

101,887



1.3

%

 

* Represents delinquency, in dollars, divided by the respective total amount of that type of loan outstanding.
** Includes purchased credit impaired loans of $760,000, $1.4 million, $1.2 million, $1.2 million, and $2.6 million at March 31, 2018, December 31, 2017, September 30, 2017, June 30, 2017, March 31, 2017, respectively.

 

Northwest Bancshares, Inc. and Subsidiaries
Allowance for loan losses (Unaudited)
(Dollars in thousands)



Quarter ended


March 31,
 2018


December 31,
 2017


September 30,
 2017


June 30,
 2017


March 31,
 2017

Beginning balance

$

56,795



56,927



62,885



61,104



60,939


Provision

4,209



6,525



3,027



5,562



4,637


Charge-offs residential mortgage

(201)



(162)



(215)



(372)



(290)


Charge-offs home equity

(611)



(393)



(528)



(689)



(649)


Charge-offs consumer finance

(1,553)



(2,900)



(3,891)



(782)



(796)


Charge-offs consumer

(3,249)



(3,322)



(3,002)



(2,735)



(2,864)


Charge-offs commercial real estate

(551)



(1,470)



(1,901)



(329)



(474)


Charge-offs commercial

(1,025)



(785)



(509)



(929)



(1,267)


Recoveries

1,397



2,375



1,061



2,055



1,868


Ending balance

$

55,211



56,795



56,927



62,885



61,104












Net charge-offs to average loans, annualized

0.30

%


0.34

%


0.47

%


0.20

%


0.23

%

 

 


March 31, 2018


Originated loans


Acquired loans


Total loans


Balance


Reserve


Balance


Reserve


Balance


Reserve

Residential mortgage loans

$

2,663,578



3,724



108,570



89



2,772,148



3,813


Home equity loans

1,040,328



3,717



248,033



728



1,288,361



4,445


Legacy consumer finance loans

12,453



3,031







12,453



3,031


Consumer loans

588,145



9,140



85,440



807



673,585



9,947


Personal Banking Loans

4,304,504



19,612



442,043



1,624



4,746,547



21,236














Commercial real estate loans

2,235,244



20,218



277,013



3,430



2,512,257



23,648


Commercial loans

564,249



9,293



59,214



1,034



623,463



10,327


Commercial Banking Loans

2,799,493



29,511



336,227



4,464



3,135,720



33,975














Total Loans

$

7,103,997



49,123



778,270



6,088



7,882,267



55,211


 

 

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


March 31, 2018


December 31, 2017


September 30, 2017


June 30, 2017


March 31, 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

$

2,756,142



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

%


$

2,718,904



27,309



4.02

%

Home equity loans

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

%


1,332,647



14,201



4.32

%

Consumer loans

637,691



7,450



4.74

%


633,023



8,004



5.02

%


617,754



7,627



4.90

%


595,170



7,405



4.99

%


580,836



7,219



5.04

%

Consumer finance loans

15,254



768



20.14

%


22,469



1,151



20.32

%


33,469



1,433



17.13

%


40,945



2,110



20.61

%


46,452



2,482



21.37

%

Commercial real estate loans

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

%


2,456,070



26,562



4.33

%

Commercial loans

595,276



7,160



4.81

%


588,420



6,739



4.48

%


593,143



6,659



4.39

%


554,506



6,087



4.34

%


522,847



5,515



4.22

%

Total loans receivable (a) (b) (d)

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

%


7,657,756



83,288



4.41

%

Mortgage-backed securities (c)

558,055



3,013



2.16

%


581,055



3,016



2.08

%


607,454



3,118



2.05

%


592,917



2,987



2.02

%


471,674



2,222



1.88

%

Investment securities (c) (d)

256,287



1,172



1.83

%


301,268



1,495



1.98

%


352,813



1,690



1.92

%


372,398



1,796



1.93

%


377,819



1,881



1.99

%

FHLB stock

9,354



97



4.21

%


10,066



78



3.07

%


7,748



63



3.23

%


7,602



50



2.64

%


7,305



59



3.28

%

Other interest-earning deposits

34,200



135



1.58

%


13,515



59



1.71

%


71,482



243



1.33

%


208,141



536



1.02

%


294,391



660



0.90

%

Total interest-earning assets

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

%


8,808,945



88,110



4.06

%

Noninterest earning assets (e)

779,812







709,753







755,026







716,913







799,569






Total assets

$

9,412,273







$

9,361,235







$

9,460,877







$

9,551,905







$

9,608,514




































Liabilities and shareholders' equity:






























Interest-bearing liabilities:






























Savings deposits

$

1,670,491



749



0.18

%


$

1,655,798



763



0.18

%


$

1,681,777



776



0.18

%


$

1,714,290



768



0.18

%


$

1,702,528



755



0.18

%

Interest-bearing demand deposits

1,419,459



603



0.17

%


1,419,352



331



0.09

%


1,435,143



297



0.08

%


1,451,787



283



0.08

%


1,422,284



116



0.03

%

Money market deposit accounts

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

%


1,879,292



1,074



0.23

%

Time deposits

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

%


1,573,574



3,520



0.91

%

Borrowed funds (f)

133,231



124



0.38

%


159,599



187



0.46

%


106,282



49



0.18

%


126,685



55



0.17

%


136,872



58



0.17

%

Junior subordinated debentures

111,213



1,184



4.26

%


111,213



1,163



4.09

%


111,213



1,150



4.05

%


111,213



1,185



4.22

%


111,213



1,167



4.20

%

Total interest-bearing liabilities

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

%


6,825,763



6,690



0.40

%

Noninterest-bearing demand deposits (g)

1,606,247







1,599,834







1,573,112







1,544,953







1,506,268






Noninterest bearing liabilities

143,608







57,956







116,021







59,277







106,578






Total liabilities

8,206,296







8,159,765







8,262,460







8,366,548







8,438,609






Shareholders' equity

1,205,977







1,201,470







1,198,417







1,185,357







1,169,905






Total liabilities and shareholders' equity

$

9,412,273







$

9,361,235







$

9,460,877







$

9,551,905







$

9,608,514






Net interest income/ Interest rate spread



82,172



3.74

%




85,032



3.79

%




84,046



3.73

%




83,565



3.69

%




81,420



3.66

%

Net interest-earning assets/ Net interest margin

$

2,176,020





3.86

%


$

2,149,507





3.93

%


$

2,132,524





3.86

%


$

2,072,674





3.78

%


$

1,983,182





3.75

%

Ratio of interest-earning assets to interest-bearing liabilities

1.34X







1.33X







1.32X







1.31X







1.29X






 

(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 0.33%, 0.30%, 0.29%, 0.29 % and 0.27%, respectively.

(h) 

Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 4.45%, 4.46%, 4.42%, 4.44% and 4.38%, respectively, Investment securities - 1.67%, 1.66%, 1.62%, 1.62% and 1.67%, respectively, Interest-earning assets - 4.21%, 4.20%, 4.11%, 4.08% and 4.02%, respectively. GAAP basis net interest rate spreads were 3.72%, 3.75%, 3.69%, 3.66% and 3.62%, respectively, and GAAP basis net interest margins were 3.84%, 3.89%, 3.82%, 3.75% and 3.71%, respectively.

 

 

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SOURCE Northwest Bancshares, Inc.