Press Release

Social media sharing Email page PDF view Print view

Northwest Bancshares, Inc. Announces First Quarter 2020 Earnings and Quarterly Dividend

Company Release - 4/27/2020 9:00 AM ET

WARREN, Pa., April 27, 2020 /PRNewswire/ -- Northwest Bancshares, Inc., (the "Company"), (NasdaqGS: NWBI) announced net income for the quarter ended March 31, 2020 of $7.9 million, or $0.07 per diluted share.  This represents a decrease of $17.1 million, or 68.3%, compared to the same quarter last year when net income was $25.0 million or $0.24 per diluted share.  The annualized returns on average shareholders' equity and average assets for the quarter ended March 31, 2020 were 2.37% and 0.30% compared to 7.96% and 1.03% 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 $0.19 per share payable on May 15, 2020 to shareholders of record as of May 7, 2020.  This is the 102nd 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, 2020, this represents an annualized dividend yield of approximately 6.57%.

In making this announcement, Ronald J. Seiffert, Chairman, President and CEO, noted, "It goes without saying that we are operating in unprecedented times that were impossible to predict just two months ago.  Similar to all individuals and businesses, we are trying to react to the daily challenges driven by the pandemic, the government mandates and the recommendations of healthcare professionals while balancing the needs and expectations of our families, employees, customers, communities and shareholders.  To that end, we have taken every measure and precaution to protect our employees while continuing to service our customers. At the same time, we are being very mindful of the fiduciary responsibility that we have to our shareholders."

Employees and Families - First, we have made a commitment to our employees, our most important and valuable asset, that we will continue to provide full pay and benefits throughout this crisis.  With the many stressors and distractions that they face on a daily basis, we want our employees to focus on servicing our customers without worrying about their own financial situation.

We have limited our branch service model to drive-through only in order to reduce direct contact between our employees and customers. Our customers may also schedule a meeting within the office through our online/website portal or take advantage of the significant investment that we have made in technology through use of our alternative delivery channels.  We have also closed a number of our offices that do not have drive-through capabilities and have reduced the number of employees servicing each office so that their hours can be reduced to accommodate their obligations at home.

In addition to the above, we have provided gloves, masks and protective goggles to our front-line employees and we are currently installing teller shields in all of our offices for added precaution when branches re-open and lobby traffic resumes.

Finally, we have established remote capabilities for our trust, brokerage, insurance, and lending representatives to work from home. Approximately 75% of our back-office and regional headquarter personnel are working virtually as well.

Customers - In order to provide relief to our customers in these unprecedented times, we have provided a number of fee concessions and changes to our lending programs.  For example, we have waived minimum deposit balance fees, ATM fees and time deposit early withdrawal fees to ease customer access to their funds.  In addition, we have approved over 4,500 requests for loan payment deferrals representing almost $1.0 billion in loan obligations.

Communities and businesses - Through the tireless efforts of our dedicated employees, we quickly established a system and process to accept over 3,500 Payroll Protection Program (PPP) loan applications for $430 million, of which approximately 30% were accepted by the SBA before the current program funding was exhausted.  We also stand ready to submit the remaining applications to the SBA and to implement the Main Street loan program once the rules are published and implemented.

Shareholders - While earnings were greatly impacted in the first quarter due to CECL and the potential impact of COVID-19, we are well positioned to weather this storm similar to our financial condition during the great recession in 2008.  We are addressing this crisis from a position of strength.  Our capital position is robust with our common equity tier 1 capital at $1.113 billion or 13.3%, total delinquencies are low at $139.9 million, or 1.6% of total loans, and real estate owned balances continue to be at historically low levels at approximately $1.0 million. Our liquidity position is ample with 10% of our on-balance sheet assets in cash and investments of which 95% of our investments are backed by GSE's.  In addition, we have over $3.0 billion of borrowing capacity with the FHLB of Pittsburgh.

Mr. Seiffert continued, "Despite the adversity caused by COVID-19, our team was able to successfully close and convert the merger with MutualBank this past weekend. We are so happy to welcome 348 new employees into the Northwest family and look forward to servicing 70,333 more households from our 36 full-service offices in Indiana.

Mr. Seiffert concluded, "I am so very proud of our employees, management team and our Board of Directors who have all risen to the occasion during these extremely challenging times and have stood tall in the face of adversity to service our customers and communities."

Net interest income decreased by $754,000, or 0.9%, to $87.2 million for the quarter ended March 31, 2020, from $88.0 million for the quarter ended March 31, 2019, primarily due to a $1.3 million, or 12.4%, increase in interest expense on deposits.    This increase was primarily due to an increase of $746.9 million in the average balance of interest-bearing deposits.  Partially offsetting this decrease was a $415,000, or 19.2%, decrease in interest expense on borrowed funds due to a decline in market interest rates when compared to the prior year.  The net impact of these changes caused the Company's net interest margin to decrease to 3.66% for the quarter ended March 31, 2020 from 3.97% for the same quarter last year.

The provision for loan losses increased by $21.2 million, or 327.4%, to $27.6 million for the quarter ended March 31, 2020, from $6.5 million for the quarter ended March 31, 2019.  During the current quarter, the Company adopted ASU 2016-13, referred to as Current Expected Credit Losses ("CECL"), which requires that all financial assets measured at amortized cost be presented at the net amount expected to be collected inclusive of the entity's current estimate of all lifetime expected credit losses.  Due to the adoption of CECL, our allowance for loan losses, reserve for unfunded commitments and equity were negatively impacted by $10.8 million, $2.3 million and $9.6 million, respectively.  In addition, the estimated economic impact of COVID-19 caused us to increase our provision expense for the quarter by approximately $23 million.

Noninterest income increased by $6.3 million, or 29.1%, to $28.0 million for the quarter ended March 31, 2020, from $21.7 million for the quarter ended March 31, 2019.  This increase was primarily due to a $3.1 million, or 25.5%, increase in service charges and fees due to a change in fee structure initiated in the fourth quarter of 2019.  We also recognized a gain of $1.3 million in the current quarter on the sale of approximately $49.5 million of one- to four-family mortgage loans from our portfolio.  We chose to sell these loans as they were identified as most likely to refinance due to declining market interest rates and we redeployed the proceeds into shorter duration consumer and commercial loans at an equivalent yield.  Also contributing to the increase was an increase in our mortgage banking income of almost $1.0 million due to continued efforts to expand our secondary market sales capabilities.  In addition, there was an increase in trust and other financial services income of $806,000, or 19.2%, primarily due to new brokerage production.

Noninterest expense increased by $7.2 million, or 10.1%, to $78.6 million for the quarter ended March 31, 2020, from $71.4 million for the quarter ended March 31, 2019.  This increase resulted primarily from a $4.6 million, or 11.9%, increase in compensation and employee benefits due to both internal growth in compensation and staff as well as the addition of Union Community Bank   employees at the beginning of March last year.  In addition, acquisition expense increased by $532,000, or 27.6%, due to expenses incurred to date as a result of the acquisition of MutualFirst Financial, Inc. and processing expenses increased by $708,000, or 6.8%, as we continue to invest in technology and infrastructure.  Partially offsetting this increase was a decrease in federal deposit insurance premiums of $706,000 due to the usage of the remaining assessment credit received during the quarter as a result of the deposit insurance fund becoming fully funded.

The provision for income taxes decreased by $5.7 million, or 84.8%, to $1.0 million for the quarter ended March 31, 2020, from $6.7 million for the quarter ended March 31, 2019.  This decrease was due primarily to the decrease in net income before taxes by $22.8 million, or 71.8%.  In addition, due to the expansion of net operating loss carryback capabilities, a $764,000 benefit was recognized in order to increase the deferred tax asset associated with carrying back losses acquired through prior mergers to years with higher statutory income tax rates.

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. As of March 31, 2020, Northwest operated 170 full-service community banking offices and eight 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; (7) increased risk associated with commercial real-estate and business loans; and (8) the effect of any pandemic, including COVID-19, war or act of terrorism.  Management has no obligation to revise or update these forward-looking statements to reflect events or circumstances that arise after the date of this release.

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Financial Condition (Unaudited)

(dollars in thousands, except per share amounts)



March 31,
 2020


December 31,
 2019


March 31,
 2019

Assets






Cash and cash equivalents

$

276,454



60,846



92,923


Marketable securities available-for-sale (amortized cost of $749,703, $815,495 and $845,989, respectively)

765,579



819,901



842,657


Marketable securities held-to-maturity (fair value of $17,968, $18,223 and $21,597, respectively)

17,208



18,036



21,671


Total cash and cash equivalents and marketable securities

1,059,241



898,783



957,251








Residential mortgage loans held-for-sale

6,426



7,709




Residential mortgage loans

2,831,860



2,860,418



2,867,161


Home equity loans

1,353,263



1,342,918



1,324,405


Consumer loans

1,178,055



1,125,132



931,062


Commercial real estate loans

2,755,468



2,754,390



2,799,309


Commercial loans

711,802



718,107



647,938


Total loans receivable

8,836,874



8,808,674



8,569,875


Allowance for loan losses

(92,897)



(57,941)



(55,721)


Loans receivable, net

8,743,977



8,750,733



8,514,154








Federal Home Loan Bank stock, at cost

13,131



14,740



12,533


Accrued interest receivable

25,531



25,755



28,107


Real estate owned, net

1,075



950



2,345


Premises and equipment, net

147,427



147,409



149,623


Bank-owned life insurance

190,127



189,091



186,251


Goodwill

346,103



346,103



344,720


Other intangible assets

21,425



23,076



25,872


Other assets

133,159



97,268



76,232


Total assets

$

10,681,196



10,493,908



10,297,088


Liabilities and shareholders' equity






Liabilities






Noninterest-bearing demand deposits

$

1,736,622



1,609,653



1,992,126


Interest-bearing demand deposits

1,975,830



1,944,108



1,583,049


Money market deposit accounts

1,946,113



1,863,998



1,778,806


Savings deposits

1,640,414



1,604,838



1,711,216


Time deposits

1,493,756



1,569,410



1,527,327


Total deposits

8,792,735



8,592,007



8,592,524








Borrowed funds

191,599



246,336



114,081


Junior subordinated debentures

121,813



121,800



121,757


Advances by borrowers for taxes and insurance

47,154



44,556



44,905


Accrued interest payable

834



1,142



1,111


Other liabilities

185,269



134,782



106,434


Total liabilities

9,339,404



9,140,623



8,980,812


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, 106,933,483, 106,859,088, and
106,220,030 shares issued and outstanding, respectively

1,069



1,069



1,062


Paid-in capital

808,250



805,750



795,044


Retained earnings

561,380



583,407



555,205


Accumulated other comprehensive loss

(28,907)



(36,941)



(35,035)


Total shareholders' equity

1,341,792



1,353,285



1,316,276


Total liabilities and shareholders' equity

$

10,681,196



10,493,908



10,297,088








Equity to assets

12.56

%


12.90

%


12.78

%

Tangible common equity to assets

9.45

%


9.72

%


9.53

%

Book value per share

$

12.55



12.66



12.39


Tangible book value per share

$

9.11



9.21



8.90


Closing market price per share

$

11.57



16.63



16.97


Full time equivalent employees

2,223



2,209



2,205


Number of banking offices

178



181



182



 

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Income (Unaudited)

(dollars in thousands, except per share amounts)



Quarter ended


March 31,
2020


December 31,
2019


September 30,
2019


June 30,
 2019


March 31,
2019






Interest income:










Loans receivable

$

94,973



97,866



101,091



100,917



94,935


Mortgage-backed securities

4,175



4,237



4,188



4,280



3,965


Taxable investment securities

648



683



884



898



936


Tax-free investment securities

185



201



224



237



182


FHLB dividends

262



262



307



316



171


Interest-earning deposits

135



169



172



159



100


Total interest income

100,378



103,418



106,866



106,807



100,289


Interest expense:










Deposits

11,403



12,893



13,694



12,484



10,145


Borrowed funds

1,747



1,580



2,236



1,720



2,162


Total interest expense

13,150



14,473



15,930



14,204



12,307


Net interest income

87,228



88,945



90,936



92,603



87,982


   Provision for loan losses

27,637



8,223



3,302



4,667



6,467


Net interest income after provision for loan losses

59,591



80,722



87,634



87,936



81,515


Noninterest income:










Gain/(loss) on sale of investments

181



27





29



(6)


Gain on sale of loans

1,302



908



826






Service charges and fees

15,116



14,125



13,558



13,339



12,043


Trust and other financial services income

5,001



4,517



4,609



4,444



4,195


Insurance commission income

2,372



1,858



1,887



2,145



2,178


Gain/(loss) on real estate owned, net

(91)



86



(227)



91



(3)


Income from bank-owned life insurance

1,035



1,121



1,095



1,197



1,005


Mortgage banking income

1,194



1,494



1,921



188



216


Other operating income

1,866



4,077



2,500



1,930



2,034


Total noninterest income

27,976



28,213



26,169



23,363



21,662


Noninterest expense:










Compensation and employee benefits

42,746



42,074



40,816



42,008



38,188


Premises and occupancy costs

7,471



7,051



7,061



7,387



7,218


Office operations

3,382



4,097



3,197



3,708



3,131


Collections expense

474



566



747



939



308


Processing expenses

11,142



10,263



11,122



10,634



10,434


Marketing expenses

1,507



1,010



1,373



2,729



1,886


Federal deposit insurance premiums





(702)



681



706


Professional services

2,812



3,533



3,032



3,198



2,524


Amortization of intangible assets

1,651



1,634



1,702



1,760



1,447


Real estate owned expense

95



72



119



128



159


Restructuring/acquisition expense

2,458



1,114



23



1,105



1,926


Other expenses

4,873



5,157



2,106



3,235



3,497


Total noninterest expense

78,611



76,571



70,596



77,512



71,424


Income before income taxes

8,956



32,364



43,207



33,787



31,753


Income tax expense

1,017



6,773



9,793



7,404



6,709


Net income

$

7,939



25,591



33,414



26,383



25,044












Basic earnings per share

$

0.08



0.24



0.32



0.25



0.24


Diluted earnings per share

$

0.07



0.24



0.31



0.25



0.24












Weighted average common shares outstanding - basic

105,882,553



105,627,194



105,517,707



105,233,635



103,101,789


Weighted average common shares outstanding - diluted

106,148,247



106,306,615



106,270,544



106,258,215



104,496,592












Annualized return on average equity

2.37

%


7.52

%


9.90

%


8.01

%


7.96

%

Annualized return on average assets

0.30

%


0.97

%


1.25

%


1.02

%


1.03

%

Annualized return on tangible common equity **

3.28

%


10.32

%


13.46

%


10.97

%


10.74

%











Efficiency ratio *

64.67

%


63.01

%


58.81

%


64.37

%


62.07

%

Annualized noninterest expense to average assets *

2.83

%


2.80

%


2.59

%


2.88

%


2.79

%


*    Excludes restructuring/acquisition expenses and amortization of intangible assets (non-GAAP).

**   Excludes goodwill and other intangible assets (non-GAAP).

 

Northwest Bancshares, Inc. and Subsidiaries

Regulatory capital requirements (Unaudited)

(dollars in thousands)



At March 31, 2020


Actual


Minimum capital

requirements (1)


Well capitalized

requirements


Amount


Ratio


Amount


Ratio


Amount


Ratio

Total capital (to risk weighted assets)












Northwest Bancshares, Inc.

$

1,314,848



15.680

%


$

880,472



10.500

%


$

838,545



10.000

%

Northwest Bank

1,185,210



14.148

%


879,618



10.500

%


837,732



10.000

%













Tier 1 capital (to risk weighted assets)












Northwest Bancshares, Inc.

1,231,345



14.684

%


712,763



8.500

%


670,836



8.000

%

Northwest Bank

1,097,002



13.095

%


712,072



8.500

%


670,185



8.000

%













CET 1 capital (to risk weighted assets)












Northwest Bancshares, Inc.

1,113,211



13.276

%


586,982



7.000

%


545,054



6.500

%

Northwest Bank

1,097,002



13.095

%


586,412



7.000

%


544,525



6.500

%













Tier 1 capital (leverage)  (to average assets)












Northwest Bancshares, Inc.

1,231,345



11.675

%


421,871



4.000

%


527,338



5.000

%

Northwest Bank

1,097,002



10.550

%


415,919



4.000

%


519,899



5.000

%


(1)

Amounts and ratios include the fully phased in capital conservation buffer of 2.5% with the exception of Tier 1 capital to average assets. For further information related to the capital conservation buffer, see "Item 1. Business - Supervision and Regulation" of our 2019 Annual Report on Form 10-K.

 

Northwest Bancshares, Inc. and Subsidiaries

Marketable securities (Unaudited)

(dollars in thousands)




March 31, 2020

Marketable securities available-for-sale


Amortized cost


Gross unrealized

holding gains


Gross unrealized

holding losses


Fair value

   Debt issued by government sponsored enterprises:









   Due in less than one year


$

50,761



475





51,236


   Due in one year through five years


25,227



284





25,511


   Due in five years through ten years


3,411



114



(103)



3,422











   Municipal securities:









   Due in less than one year


812



3





815


   Due in one year through five years


2,897



68





2,965


   Due in five years through ten years


8,903



178





9,081


   Due after ten years


31,400



436





31,836











   Residential mortgage-backed securities:









   Fixed rate pass-through


130,729



4,453



(10)



135,172


   Variable rate pass-through


18,025



403



(8)



18,420


   Fixed rate agency CMOs


423,625



10,447



(60)



434,012


   Variable rate agency CMOs


53,913



62



(866)



53,109


   Total residential mortgage-backed securities


626,292



15,365



(944)



640,713


   Total marketable securities available-for-sale


$

749,703



16,923



(1,047)



765,579











Marketable securities held-to-maturity









   Residential mortgage-backed securities:









   Fixed rate pass-through


$

2,096



113





2,209


   Variable rate pass-through


1,119



15





1,134


   Fixed rate agency CMOs


13,389



639





14,028


   Variable rate agency CMOs


604



1



(8)



597


   Total residential mortgage-backed securities


17,208



768



(8)



17,968


   Total marketable securities held-to-maturity


$

17,208



768



(8)



17,968


 

Northwest Bancshares, Inc. and Subsidiaries

Borrowed funds (Unaudited)

(dollars in thousands)



March 31, 2020


Amount


Average rate

Term notes payable to the FHLB of Pittsburgh:




Due within one year

$

100,000



0.74% *

Total term notes payable to FHLB of Pittsburgh

100,000




Collateralized borrowings, due within one year

91,599




0.30%

Total borrowed funds **

$

191,599





*     Represents four fixed rate advances: $30.0 million at 0.91% maturing June 16, 2020; $25.0 million at 0.70% maturing June 22, 2020; $25.0 million at 0.70% maturing June 22, 2020; and $20.0 million at 0.59% maturing June 26, 2020.

**   As of March 31, 2020, the Company had $3.3 billion of additional borrowing capacity available with the Federal Home Loan Bank of Pittsburgh, including a $250.0 million overnight line of credit, which had no balance, as well as $36.6 million of borrowing capacity available with the Federal Reserve Bank and $110.0 million with three correspondent banks.

 

Northwest Bancshares, Inc. and Subsidiaries

Asset quality (Unaudited)

(dollars in thousands)



March 31,
 2020


December 31,
 2019


September 30,
 2019


June 30,
 2019


March 31,
 2019

Nonaccrual loans current:










Residential mortgage loans

$

285



72



676



432



124


Home equity loans

592



197



607



475



643


Consumer loans

77



78



68



94



76


Commercial real estate loans

14,337



9,241



7,674



12,605



10,520


Commercial loans

3,514



3,424



3,777



5,666



4,277


Total nonaccrual loans current

$

18,805



13,012



12,802



19,272



15,640


Nonaccrual loans delinquent 30 days to 59 days:










Residential mortgage loans

$

691



674



40



13



824


Home equity loans

159



224



102



418



160


Consumer loans

143



121



246



172



154


Commercial real estate loans

496



196



925



469



2,642


Commercial loans



55



44



45



321


Total nonaccrual loans delinquent 30 days to 59 days

$

1,489



1,270



1,357



1,117



4,101


Nonaccrual loans delinquent 60 days to 89 days:










Residential mortgage loans

$

218



1,048



979



910



1,323


Home equity loans

539



689



436



717



954


Consumer loans

488



417



426



322



683


Commercial real estate loans

2,096



413



536



1,426



3,588


Commercial loans

37



341





780



397


Total nonaccrual loans delinquent 60 days to 89 days

$

3,378



2,908



2,377



4,155



6,945


Nonaccrual loans delinquent 90 days or more:










Residential mortgage loans

$

10,457



12,682



11,722



10,617



10,781


Home equity loans

5,816



5,635



5,966



5,591



5,542


Consumer loans

3,459



3,610



3,400



2,902



3,215


Commercial real estate loans

25,342



25,014



22,292



21,123



24,528


Commercial loans

16,685



4,739



5,741



2,920



2,027


Total nonaccrual loans delinquent 90 days or more

$

61,759



51,680



49,121



43,153



46,093


Total nonaccrual loans

$

85,431



68,870



65,657



67,697



72,779


Total nonaccrual loans

$

85,431



68,870



65,657



67,697



72,779


Loans 90 days past maturity and still accruing

31



32



85



55



166


Nonperforming loans

85,462



68,902



65,742



67,752



72,945


Real estate owned, net

1,075



950



1,237



2,070



2,345


Nonperforming assets

$

86,537



69,852



66,979



69,822



75,290


Nonaccrual troubled debt restructuring *

$

17,375



9,043



9,138



13,375



14,951


Accruing troubled debt restructuring

15,977



22,956



21,162



17,894



17,861


Total troubled debt restructuring

$

33,352



31,999



30,300



31,269



32,812












Nonperforming loans to total loans

0.97

%


0.78

%


0.74

%


0.78

%


0.85

%

Nonperforming assets to total assets

0.81

%


0.67

%


0.63

%


0.66

%


0.73

%

Allowance for loan losses to total loans

1.05

%


0.66

%


0.60

%


0.61

%


0.65

%

Allowance for loan losses to nonperforming loans

108.70

%


84.09

%


80.40

%


78.38

%


76.39

%


*    Amounts included in nonperforming loans above.

 

Northwest Bancshares, Inc. and Subsidiaries

Loans by credit quality indicators (Unaudited)

(dollars in thousands)


At March 31, 2020


Pass


Special

   mention *


Substandard

**


Doubtful


Loss


Loans

receivable

Personal Banking:













Residential mortgage loans


$

2,830,596





7,690







2,838,286


Home equity loans


1,345,052





8,211







1,353,263


Consumer loans


1,174,067





3,988







1,178,055


Total Personal Banking


5,349,715





19,889







5,369,604


Commercial Banking:













Commercial real estate loans


2,537,736



73,967



143,765







2,755,468


Commercial loans


618,267



43,071



50,464







711,802


Total Commercial Banking


3,156,003



117,038



194,229







3,467,270


Total loans


$

8,505,718



117,038



214,118







8,836,874


At December 31, 2019













Personal Banking:













Residential mortgage loans


$

2,858,582





9,545







2,868,127


Home equity loans


1,336,111





6,807







1,342,918


Consumer loans


1,120,732





4,400







1,125,132


Total Personal Banking


5,315,425





20,752







5,336,177


Commercial Banking:













Commercial real estate loans


2,538,816



80,570



135,004







2,754,390


Commercial loans


616,983



42,380



58,744







718,107


Total Commercial Banking


3,155,799



122,950



193,748







3,472,497


Total loans


$

8,471,224



122,950



214,500







8,808,674


At September 30, 2019













Personal Banking:













Residential mortgage loans


$

2,887,077





9,056







2,896,133


Home equity loans


1,320,930





7,243







1,328,173


Consumer loans


1,090,030





4,263







1,094,293


Total Personal Banking


5,298,037





20,562







5,318,599


Commercial Banking:













Commercial real estate loans


2,601,025



69,380



142,253



181





2,812,839


Commercial loans


639,998



37,666



42,800



115





720,579


Total Commercial Banking


3,241,023



107,046



185,053



296





3,533,418


Total loans


$

8,539,060



107,046



205,615



296





8,852,017


At June 30, 2019













Personal Banking:













Residential mortgage loans


$

2,890,472





8,692







2,899,164


Home equity loans


1,307,887





7,060







1,314,947


Consumer loans


1,007,813





3,611







1,011,424


Total Personal Banking


5,206,172





19,363







5,225,535


Commercial Banking:













Commercial real estate loans


2,586,013



86,434



135,525



181





2,808,153


Commercial loans


621,889



38,182



42,141



982





703,194


Total Commercial Banking


3,207,902



124,616



177,666



1,163





3,511,347


Total loans


$

8,414,074



124,616



197,029



1,163





8,736,882


At March 31, 2019













Personal Banking:













Residential mortgage loans


$

2,858,007





9,154







2,867,161


Home equity loans


1,317,323





7,082







1,324,405


Consumer loans


926,832





4,230







931,062


Total Personal Banking


5,102,162





20,466







5,122,628


Commercial Banking:













Commercial real estate loans


2,577,176



87,053



135,080







2,799,309


Commercial loans


573,160



34,610



40,168







647,938


Total Commercial Banking


3,150,336



121,663



175,248







3,447,247


Total loans


$

8,252,498



121,663



195,714







8,569,875



*    Includes $13.1 million, $10.3 million, $8.7 million, $8.1 million, and $3.4 million of acquired loans at March 31, 2020, December 31, 2019, September 30, 2019, December 31, 2019, and March 31, 2019, respectively.

**  Includes $56.8 million, $53.1 million, $46.6 million, $38.6 million, and $37.8 million of acquired loans at March 31, 2020, December 31, 2019, September 30, 2019, December 31, 2019, and March 31, 2019, respectively.

 

Northwest Bancshares, Inc. and Subsidiaries

Loan delinquency (Unaudited)

(dollars in thousands)




March 31, 2020


*


December 31, 2019


*


September 30, 2019


*


June 30, 2019


*


March 31, 2019


*

(Number of loans and dollar amount of loans)































Loans delinquent 30 days to 59 days:































Residential mortgage loans


358



$

32,755



1.2

%


292



$

23,296



0.8

%


21



$

1,236



%


30



$

1,629



0.1

%


311



$

28,009



1.0

%

Home equity loans


190



7,061



0.5

%


173



6,469



0.5

%


149



4,774



0.4

%


148



4,573



0.3

%


195



7,626



0.6

%

Consumer loans


953



8,774



0.7

%


960



9,208



0.8

%


864



7,597



0.7

%


856



7,630



0.7

%


905



7,523



0.8

%

Commercial real estate loans


58



12,895



0.5

%


43



7,921



0.3

%


27



5,308



0.2

%


31



2,418



0.1

%


48



28,965



1.0

%

Commercial loans


35



7,545



1.1

%


32



1,187



0.2

%


20



362



0.1

%


14



666



0.1

%


30



3,359



0.5

%

Total loans delinquent 30 days to 59 days


1,594



$

69,030



0.8

%


1,500



$

48,081



0.5

%


1,081



$

19,277



0.2

%


1,079



$

16,916



0.2

%


1,489



$

75,482



0.9

%
































Loans delinquent 60 days to 89 days:































Residential mortgage loans


11



$

511



%


67



$

5,693



0.2

%


95



$

5,320



0.2

%


78



$

6,264



0.2

%


29



$

2,602



0.1

%

Home equity loans


65



2,652



0.2

%


66



2,405



0.2

%


66



2,103



0.2

%


59



2,319



0.2

%


53



2,544



0.2

%

Consumer loans


265



2,610



0.2

%


395



3,302



0.3

%


288



2,632



0.2

%


338



2,897



0.3

%


299



2,177



0.2

%

Commercial real estate loans


12



2,981



0.1

%


19



1,690



0.1

%


15



1,893



0.1

%


16



2,617



0.1

%


17



4,064



0.1

%

Commercial loans


10



309



%


17



6,403



0.9

%


10



589



0.1

%


16



1,725



0.2

%


7



738



0.1

%

Total loans delinquent 60 days to 89 days


363



$

9,063



0.1

%


564



$

19,493



0.2

%


474



$

12,537



0.1

%


507



$

15,822



0.2

%


405



$

12,125



0.2

%
































Loans delinquent 90 days or more: **































Residential mortgage loans


129



$

10,457



0.4

%


141



$

12,775



0.4

%


138



$

11,816



0.4

%


129



$

10,800



0.4

%


113



$

10,801



0.4

%

Home equity loans


152



5,816



0.4

%


159



5,688



0.4

%


157



5,966



0.4

%


136



5,591



0.4

%


155



5,542



0.4

%

Consumer loans


445



3,459



0.3

%


590



3,611



0.3

%


398



3,401



0.3

%


710



2,908



0.3

%


764



3,221



0.3

%

Commercial real estate loans


139



25,342



0.9

%


129



25,014



0.9

%


118



22,292



0.8

%


118



21,123



0.7

%


125



24,589



0.9

%

Commercial loans


51



16,685



2.3

%


37



4,739



0.7

%


40



5,741



0.8

%


25



2,920



0.4

%


23



2,027



0.3

%

Total loans delinquent 90 days or more


916



$

61,759



0.7

%


1,056



$

51,827



0.6

%


851



$

49,216



0.6

%


1,118



$

43,342



0.5

%


1,180



$

46,180



0.6

%
































Total loans delinquent


2,873



$

139,852



1.6

%


3,120



$

119,401



1.4

%


2,406



$

81,030



0.9

%


2,704



$

76,080



0.9

%


3,074



$

133,787



1.6

%


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

**  Includes purchased credit deteriorated loans of $298,000 at March 31, 2020, and purchased credit impaired loans of $147,000, $95,000, $190,000, and $87,000 at December 31, 2019, September 30, 2019, June 30, 2019, and March 31, 2019, respectively.

 

Northwest Bancshares, Inc. and Subsidiaries

Analysis of loan portfolio by loan sector (Unaudited)

(dollars in thousands)

Loans outstanding


At March 31, 2020


30-59 days
delinquent


*


60-89 days
delinquent


*


90 days or
greater delinquent


*


Total
delinquent


*


Current


*


Total loans
receivable


*

Restaurants/bars


$

47



%


$



%


$

116



%


$

163



%


$

46,058



0.5

%


$

46,221



0.5

%

Hotels/hospitality




%




%




%




%


183,697



2.1

%


183,697



2.1

%

Gyms and fitness


109



%


59



%




%


168



%


3,931



%


4,099



%

Transportation




%




%


5,094



0.1

%


5,094



0.1

%


11,145



0.1

%


16,239



0.2

%

Oil and gas


130



%




%


1,781



%


1,911



%


22,091



0.2

%


24,002



0.3

%

Residential care facilities




%




%




%




%


192,264



2.2

%


192,264



2.2

%

Education


4,151



%




%


506



%


4,657



%


35,751



0.4

%


40,408



0.4

%

All other sectors


64,593



0.8

%


9,004



0.1

%


54,262



0.6

%


127,859



1.5

%


8,202,085



92.8

%


8,329,944



94.3

%

   Total loans


$

69,030



0.8

%


$

9,063



0.1

%


$

61,759



0.7

%


$

139,852



1.6

%


$

8,697,022



98.4

%


$

8,836,874



100.0

%


*   Percent of total loans outstanding.

 

Loan deferrals


At March 31, 2020


# of
Loans


Outstanding

principal balance

Residential mortgage loans


640


$

96,839


Home equity loans


533


33,521


Consumer loans


1,803


33,443


Commercial real estate loans


1,041


736,688


Commercial loans


542


85,483


   Total loans *


4,559


$

985,974



*   Represents loans that entered into an optional 90 day deferral period offered by the Company to aid customers during the COVID-19 pandemic.  The loan balances reflected are as of March 31, 2020, however, the approval of the deferral occurred during the month of April 2020.

 

Northwest Bancshares, Inc. and Subsidiaries

Allowance for loan losses (Unaudited)

(dollars in thousands)



Quarter ended


March 31,
2020


December 31,
2019


September 30,
2019


June 30,
2019


March 31,
2019

Beginning balance

$

57,941



52,859



53,107



55,721



55,214


CECL adoption

10,792










Provision

27,637



8,223



3,302



4,667



6,467


Charge-offs residential mortgage

(343)



(222)



(190)



(397)



(357)


Charge-offs home equity

(289)



(113)



(466)



(389)



(153)


Charge-offs consumer

(3,488)



(3,142)



(3,078)



(2,566)



(3,021)


Charge-offs commercial real estate

(331)



(107)



(389)



(4,367)



(604)


Charge-offs commercial

(815)



(1,143)



(1,151)



(1,087)



(3,270)


Recoveries

1,793



1,586



1,724



1,525



1,445


Ending balance

$

92,897



57,941



52,859



53,107



55,721


Net charge-offs to average loans, annualized

0.16

%


0.14

%


0.16

%


0.34

%


0.29

%

 


March 31, 2020


Originated loans


Acquired loans


Total loans


Balance


Reserve


Balance


Reserve


Balance


Reserve

Residential mortgage loans

$

2,762,248



10,299



76,038



374



2,838,286



10,673


Home equity loans

1,121,979



8,497



231,284



1,288



1,353,263



9,785


Consumer loans

1,163,689



16,962



14,366



198



1,178,055



17,160


Personal Banking Loans

5,047,916



35,758



321,688



1,860



5,369,604



37,618


Commercial real estate loans

2,374,451



30,628



381,017



7,128



2,755,468



37,756


Commercial loans

658,161



16,045



53,641



1,478



711,802



17,523


Commercial Banking Loans

3,032,612



46,673



434,658



8,606



3,467,270



55,279


Total Loans

$

8,080,528



82,431



756,346



10,466



8,836,874



92,897


 

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, 2020


December 31, 2019


September 30, 2019


June 30, 2019


March 31, 2019


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

$

2,845,483



28,062



3.94

%


$

2,847,932



28,011



3.93

%


$

2,894,716



28,991



4.01

%


$

2,857,425



29,300



4.10

%


$

2,842,556



29,282



4.12

%

Home equity loans

1,345,059



14,801



4.43

%


1,333,748



15,354



4.57

%


1,316,033



16,131



4.86

%


1,319,056



17,717



5.39

%


1,265,974



16,048



5.14

%

Consumer loans

1,123,336



12,160



4.35

%


1,073,565



12,016



4.44

%


1,028,579



11,916



4.60

%


945,080



10,736



4.57

%


872,535



10,191



4.74

%

Commercial real estate loans

2,747,419



31,437



4.53

%


2,741,687



32,985



4.71

%


2,796,351



34,441



4.82

%


2,801,953



35,537



5.02

%


2,560,408



30,767



4.81

%

Commercial loans

712,621



8,856



4.92

%


717,438



9,841



5.37

%


710,847



9,949



5.48

%


670,613



7,966



4.70

%


615,090



8,967



5.83

%

Total loans receivable (a) (b) (d)

8,773,918



95,316



4.37

%


8,714,370



98,207



4.47

%


8,746,526



101,428



4.60

%


8,594,127



101,256



4.73

%


8,156,563



95,255



4.74

%

Mortgage-backed securities (c)

668,470



4,175



2.50

%


667,910



4,237



2.54

%


641,085



4,188



2.61

%


644,887



4,280



2.65

%


604,463



3,965



2.62

%

Investment securities (c) (d)

144,152



881



2.44

%


151,289



938



2.48

%


218,753



1,168



2.14

%


226,325



1,198



2.12

%


227,312



1,167



2.05

%

FHLB stock, at cost

15,931



262



6.61

%


13,400



262



7.76

%


16,302



307



7.47

%


16,117



316



7.86

%


16,098



171



4.31

%

Other interest-earning deposits

34,697



135



1.54

%


31,624



169



2.09

%


28,832



172



2.33

%


20,983



159



3.00

%


14,136



100



2.83

%

Total interest-earning assets

9,637,168



100,769



4.21

%


9,578,593



103,813



4.30

%


9,651,498



107,263



4.41

%


9,502,439



107,209



4.53

%


9,018,572



100,658



4.53

%

Noninterest earning assets (e)

960,303







869,117







916,781







910,225







868,843






Total assets

$

10,597,471







$

10,447,710







$

10,568,279







$

10,412,664







$

9,887,415






Liabilities and shareholders' equity:






























Interest-bearing liabilities:






























Savings deposits

$

1,611,111



727



0.18

%


$

1,615,996



792



0.19

%


$

1,658,670



788



0.19

%


$

1,696,715



777



0.18

%