Northwest Bancshares, Inc. Announces First Quarter 2014 Earnings and Dividend Declaration

Apr 21, 2014, 10:40 ET from Northwest Bancshares, Inc.

WARREN, Pa., April 21, 2014 /PRNewswire/ -- Northwest Bancshares, Inc. (NasdaqGS: NWBI) announced net income for the quarter ended March 31, 2014 of $14.6 million, or $0.16 per diluted share. This represents a decrease of $658,000, or 4.3%, over the same quarter last year when net income was $15.3 million, or $0.17 per diluted share, and a decrease of $5.8 million, or 28.1%, compared to the quarter ended December 31, 2013 when net income was $20.4 million, or $0.22 per diluted share. The annualized returns on average shareholders' equity and average assets for the current quarter were 5.16% and 0.75% compared to 5.45% and 0.78% for the same quarter last year and 7.06% and 1.02% for the quarter ended December 31, 2013.

The Company also announced that its Board of Directors declared a regular quarterly cash dividend of $0.13 per share in addition to the $1.00 special dividend announced on April 14, 2014. Both dividends are payable on May 15, 2014, to shareholders of record as of May 1, 2014 with an ex-dividend date, as established by Nasdaq, of April 29, 2014. This represents the 78th consecutive quarter in which the Company has paid a cash dividend.

In making this announcement, William J. Wagner, President and CEO, noted, "Our operating results for the first quarter did not meet our expectations due primarily to the deterioration of two commercial loans. However, core earnings remained relatively consistent with little change in our net interest margin during the quarter, a 6.3% increase in fee-based income from a year ago and a 3.3% year-over-year increase in operating expense. Market reaction to the $1.00 per share special dividend has been positive. We are hopeful that the significant increase in the market value of our shares that followed the announcement will enable Northwest to achieve greater success in pursuing mergers and acquisitions that are beneficial to our shareholders. Finally, we were pleased to learn that Forbes named our company to its list of America's 50 Most Trustworthy Financial Companies."

Net interest income decreased by $3.1 million, or 4.8%, to $60.9 million for the quarter ended March 31, 2014, from $64.0 million for the quarter ended March 31, 2013, as decreases in interest income on loans receivable and investment securities of $3.6 million and $881,000, respectively, were partially offset by a $1.3 million decrease in interest paid on deposit accounts. These changes from the previous year were due primarily to the continued low level of market interest rates.

The provision for loan losses increased by $327,000, or 4.6%, to $7.5 million for the quarter ended March 31, 2014, from $7.2 million for the quarter ended March 31, 2013 and increased by $6.5 million compared to the quarter ended December 31, 2013. This increase is due primarily to two commercial loans requiring reserves of $4.9 million and $1.2 million, respectively. Had it not been for these two extraordinary items, the quarterly provision would have been significantly less as asset quality has improved greatly with loans 90 days or more delinquent decreasing $21.2 million, or 29.2%, from a year ago. At March 31, 2014, the allowance for loan losses was $76.2 million, or 1.30% of total loans, compared to $72.0 million, or 1.28% of total loans, at March 31, 2013. Net charge-offs were $2.6 million, or 0.18% of average loans for the quarter ended March 31, 2014 compared to $8.4 million, or 0.59% for the same quarter last year.

Noninterest income increased by $3.3 million, or 20.0%, to $19.7 million for the quarter ended March 31, 2014, from $16.4 million for the quarter ended March 31, 2013. This increase is due primarily to a $3.2 million increase in the gain on sale of investments. Additionally, trust and other financial services income increased by $843,000, due primarily to our acquisition of Evans Capital Management, Inc. as of January 1, 2014. Partially offsetting these increases was a decrease in mortgage banking income of $707,000, due primarily to the retention of the residential mortgage loans that we originated during the current quarter.

Noninterest expense increased by $1.7 million, or 3.3%, to $53.2 million for the quarter ended March 31, 2014, from $51.5 million for the quarter ended March 31, 2013. This increase was due primarily to a $736,000 increase in processing expense as the result of software upgrades. Additionally, office operations increased by $489,000, due primarily to increased collections costs. Partially offsetting these increases was a decrease in marketing expense of $263,000, which was due to the timing of various campaigns in the current and prior year.

Our effective tax rate of 26.5% during the quarter ended March 31, 2014 is reflective of the expected lower annual tax rate due primarily to the deductibility of dividends paid on the Company's stock held in our Employee Stock Ownership Plan and 401(k) plan.

Headquartered in Warren, Pennsylvania, Northwest Bancshares, Inc. is the holding company of Northwest Savings Bank. Founded in 1896, Northwest Savings 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 165 community banking offices in Pennsylvania, New York, Ohio and Maryland and 50 consumer finance offices in Pennsylvania through its subsidiary, Northwest Consumer Discount Company. Northwest Bancshares, Inc.'s common stock is listed on the NASDAQ Global Select Market. Additional information regarding Northwest Bancshares, Inc. can be accessed on-line at www.northwestsavingsbank.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; and (7) increased risk associated with an increase in 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

(Dollars in thousands, except per share amounts)

(Unaudited)

March 31,

December 31,

Assets

2014

2013

Cash and cash equivalents

$         81,927

98,122

Interest-earning deposits in other financial institutions

379,765

293,149

Federal funds sold and other short-term investments

634

634

Marketable securities available-for-sale (amortized cost of $1,008,975 and $1,022,078)

1,009,717

1,016,767

Marketable securities held-to-maturity (fair value of $120,933 and $124,061)

117,724

121,366

Total cash, interest-earning deposits and marketable securities

1,589,767

1,530,038

Residential mortgage loans held for sale

-

221

Residential mortgage loans

2,485,688

2,482,783

Home equity loans 

1,065,988

1,083,939

Other consumer loans

223,045

228,348

Commercial real estate loans

1,664,255

1,608,399

Commercial loans

412,098

402,601

Total loans receivable

5,851,074

5,806,291

Allowance for loan losses

(76,234)

(71,348)

Loans receivable, net

5,774,840

5,734,943

Federal Home Loan Bank stock, at cost

43,714

43,715

Accrued interest receivable

22,188

21,821

Real estate owned, net

16,692

18,203

Premises and Equipment, net

146,880

146,139

Bank owned life insurance

141,173

140,172

Goodwill

175,988

174,463

Other intangible assets

4,025

2,319

Other assets

59,693

69,663

Total assets

$   7,974,960

7,881,476

Liabilities and Shareholders' equity

Liabilities

Noninterest-bearing demand deposits

$      844,743

789,135

Interest-bearing demand deposits

890,788

852,809

Money market deposit accounts

1,176,462

1,167,954

Savings deposits

1,236,130

1,191,584

Time deposits

1,626,740

1,667,397

Total deposits

5,774,863

5,668,879

Borrowed funds

865,621

881,645

Advances by borrowers for taxes and insurance

31,074

26,669

Accrued interest payable

860

888

Other liabilities

41,892

43,499

Junior subordinated debentures

103,094

103,094

Total liabilities

6,817,404

6,724,674

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, 94,464,430 shares and 94,243,713 shares issued and outstanding, respectively

945

943

Paid-in-capital

622,758

619,678

Retained earnings

564,580

571,164

Unallocated common stock of Employee Stock Ownership Plan

(22,632)

(23,083)

Accumulated other comprehensive loss

(8,095)

(11,900)

Total shareholders' equity

1,157,556

1,156,802

Total liabilities and shareholders' equity

$   7,974,960

7,881,476

Equity to assets

14.51%

14.68%

Tangible common equity to assets

12.54%

12.72%

Book value per share

$          12.25

12.27

Tangible book value per share

$          10.35

10.40

Closing market price per share

$          14.60

14.78

Full time equivalent employees

2,050

2,043

Number of banking offices

165

165

 

 

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Income

(Dollars in thousands, except per share amounts)

Quarter ended

March 31,

December 31,

2014

2013

2013

Interest income:

Loans receivable

$      69,373

72,973

70,849

Mortgage-backed securities

2,793

3,441

2,956

Taxable investment securities

1,080

905

1,052

Tax-free investment securities

1,655

2,063

1,748

Interest-earning deposits

200

251

249

Total interest income

75,101

79,633

76,854

Interest expense:

Deposits

6,490

7,814

6,911

Borrowed funds

7,714

7,831

7,894

Total interest expense

14,204

15,645

14,805

Net interest income

60,897

63,988

62,049

Provision for loan losses

7,485

7,158

964

Net interest income after provision

for loan losses

53,412

56,830

61,085

Noninterest income:

Impairment losses on securities

-

-

(713)

Noncredit related losses on securities not expected

to be sold (recognized in other comprehensive income)

-

-

-

Net impairment losses

-

-

(713)

Gain on sale of investments, net

3,348

101

5,889

Service charges and fees

8,408

8,691

8,874

Trust and other financial services income

3,047

2,204

2,483

Insurance commission income

2,564

2,295

2,131

Loss on real estate owned, net

(135)

(130)

(660)

Income from bank owned life insurance

1,001

1,085

1,846

Mortgage banking income

249

956

228

Other operating income

1,175

1,176

869

Total noninterest income

19,657

16,378

20,947

Noninterest expense:

Compensation and employee benefits

27,972

27,930

28,475

Premises and occupancy costs

6,557

6,153

5,652

Office operations

3,757

3,268

3,823

Processing expenses

6,589

5,853

6,269

Marketing expenses

1,637

1,900

1,259

Federal deposit insurance premiums

1,297

1,438

1,361

Professional services

2,062

1,693

2,044

Amortization of intangible assets

331

348

222

Real estate owned expense

639

599

557

Other expense

2,322

2,289

2,918

Total noninterest expense

53,163

51,471

52,580

Income before income taxes

19,906

21,737

29,452

Income tax expense

5,266

6,439

9,089

Net income

$      14,640

15,298

20,363

Basic earnings per share

$          0.16

0.17

0.22

Diluted earnings per share

$          0.16

0.17

0.22

Annualized return on average equity

5.16%

5.45%

7.06%

Annualized return on average assets

0.75%

0.78%

1.02%

Basic common shares outstanding

91,154,998

90,403,909

90,864,076

Diluted common shares outstanding

92,353,312

90,878,903

92,245,167

 

 

Northwest Bancshares, Inc. and Subsidiaries

Asset quality

(Dollars in thousands)

March 31, 2014

December 31,  2013

March 31, 2013

December 31,  2012

Non-accrual loans current:

Residential mortgage loans

$          1,064

1,361

1,728

797

Home equity loans

1,771

835

1,050

635

Other consumer loans

136

98

87

44

Commercial real estate loans

26,564

17,866

25,203

24,960

Commercial loans

19,603

13,357

9,069

5,424

Total non-accrual loans current

$        49,138

33,517

37,137

31,860

Non-accrual loans delinquent 30 days to 59 days:

Residential mortgage loans

$             741

427

1,789

-

Home equity loans

155

404

222

-

Other consumer loans

36

15

26

-

Commercial real estate loans

4,118

3,468

5,105

5,549

Commercial loans

5

7,650

2,631

2,002

Total non-accrual loans delinquent 30 days to 59 days

$         5,055

11,964

9,773

7,551

Non-accrual loans delinquent 60 days to 89 days:

Residential mortgage loans

$         1,914

864

1,969

-

Home equity loans

485

280

330

-

Other consumer loans

99

87

74

-

Commercial real estate loans

902

2,036

2,506

2,802

Commercial loans

95

716

1,318

9,652

Total non-accrual loans delinquent 60 days to 89 days

$         3,495

3,983

6,197

12,454

Non-accrual loans delinquent 90 days or more:

Residential mortgage loans

$       20,564

24,625

24,416

24,286

Home equity loans

8,420

8,344

7,967

8,479

Other consumer loans

1,818

2,057

1,802

1,936

Commercial real estate loans

16,098

18,433

22,204

24,550

Commercial loans

4,494

4,298

16,246

9,096

Total non- accrual loans delinquent 90 days or more

$       51,394

57,757

72,635

68,347

Total non-accrual loans

$     109,082

107,221

125,742

120,212

March 31,

December 31,

March 31,

December 31,

2014

2013

2013

2012

Non-accrual loans

$     109,082

107,221

125,742

120,212

Loans 90 days past maturity and still accruing

709

690

781

1,698

   Nonperforming loans

109,791

107,911

126,523

121,910

Real estate owned, net

16,692

18,203

24,035

26,165

   Nonperforming assets

$     126,483

126,114

150,558

148,075

Non-accrual troubled debt restructuring *

$       34,268

28,889

46,109

41,166

Accruing troubled debt restructuring

40,243

50,277

45,256

48,278

Total troubled debt restructuring

$       74,511

79,166

91,365

89,444

Nonperforming loans to total loans

1.88%

1.86%

2.26%

2.14%

Nonperforming assets to total assets

1.59%

1.60%

1.88%

1.86%

Allowance for loan losses to total loans

1.30%

1.23%

1.28%

1.28%

Allowance for loan losses to nonperforming loans

69.44%

66.12%

56.91%

60.06%

* Amounts included in nonperforming loans above.

 

 

Northwest Bancshares, Inc. and Subsidiaries

Delinquency

(Dollars in thousands)

Loan delinquency schedule

(Number of loans and dollar amount of loans)

March 31,

December 31,

March 31,

December 31,

2014

*

2013

*

2013

*

2012

*

Loans delinquent 30 days to 59 days:

Residential mortgage loans

352

$ 26,874

1.1%

374

$ 27,486

1.1%

410

$ 33,054

1.4%

430

$ 32,921

1.4%

Home equity loans

172

5,449

0.5%

213

6,946

0.6%

204

6,254

0.6%

224

6,534

0.6%

Consumer loans

749

3,412

1.5%

1,010

4,515

2.0%

789

3,684

1.7%

1,122

5,456

2.4%

Commercial real estate loans

84

26,518

1.6%

73

8,449

0.5%

93

12,833

0.8%

87

13,001

0.8%

Commercial loans

41

1,375

0.3%

34

9,243

2.3%

49

4,620

1.2%

41

3,233

0.8%

Total loans delinquent 30 days to 59 days

1,398

$ 63,628

1.1%

1,704

$ 56,639

1.0%

1,545

60,445

1.1%

1,904

$ 61,145

1.1%

Loans delinquent 60 days to 89 days:

Residential mortgage loans

46

$   3,674

0.1%

103

$  7,568

0.3%

54

$  4,577

0.2%

100

$   9,387

0.4%

Home equity loans

42

1,437

0.1%

67

2,243

0.2%

67

2,321

0.2%

65

1,977

0.2%

Consumer loans

330

1,289

0.6%

507

1,866

0.8%

302

1,145

0.5%

448

1,830

0.8%

Commercial real estate loans

33

2,570

0.2%

35

3,968

0.2%

32

4,448

0.3%

33

4,596

0.3%

Commercial loans

9

473

0.1%

16

1,555

0.4%

19

1,654

0.4%

17

10,158

2.6%

Total loans delinquent 60 days to 89 days

460

$  9,443

0.2%

728

$ 17,200

0.3%

474

14,145

0.3%

663

$ 27,948

0.5%

Loans delinquent 90 days or more:

Residential mortgage loans

236

$ 20,564

0.8%

273

$ 24,625

1.0%

233

$ 24,416

1.0%

266

$  24,286

1.0%

Home equity loans

176

8,420

0.8%

171

8,344

0.8%

179

7,967

0.8%

175

8,479

0.8%

Consumer loans

391

1,818

0.8%

470

2,057

0.9%

374

1,802

0.8%

427

1,936

0.8%

Commercial real estate loans

116

16,098

1.0%

124

18,433

1.1%

127

22,204

1.4%

146

24,550

1.5%

Commercial loans

33

4,494

1.1%

31

4,298

1.1%

51

16,246

4.1%

61

9,096

2.3%

Total loans delinquent 90 days or more

952

$ 51,394

0.9%

1,069

$ 57,757

1.0%

964

72,635

1.3%

1,075

$  68,347

1.2%

Total loans delinquent

2,810

$124,465

2.1%

3,501

$131,596

2.3%

2,983

$147,225

2.6%

3,642

$157,440

2.8%

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

 

 

Northwest Bancshares, Inc. and Subsidiaries

Loans by credit quality indicators as of March 31, 2014

(Dollars in thousands)

Recorded

investment

Special

in loans

Pass

mention

Substandard

 Doubtful 

 Loss 

receivable

Personal Banking:

Residential mortgage loans

$ 2,469,561

-

14,649

-

1,478

2,485,688

Home equity loans

1,057,568

-

8,420

-

-

1,065,988

Other consumer loans

221,776

-

1,269

-

-

223,045

Total Personal Banking

3,748,905

-

24,338

-

1,478

3,774,721

Business Banking:

Commercial real estate loans

1,456,037

54,004

151,248

2,966

-

1,664,255

Commercial loans

357,778

11,987

33,515

8,818

-

412,098

Total Business Banking

1,813,815

65,991

184,763

11,784

-

2,076,353

$ 5,562,720

65,991

209,101

11,784

1,478

5,851,074

Northwest Bancshares, Inc. and Subsidiaries

Loans by credit quality indicators as of December 31, 2013

(Dollars in thousands)

Recorded

investment

Special

in loans

Pass

mention

Substandard

 Doubtful 

 Loss 

receivable

Personal Banking:

Residential mortgage loans

$ 2,464,057

-

17,626

-

1,321

2,483,004

Home equity loans

1,075,595

-

8,344

-

-

1,083,939

Other consumer loans

226,922

-

1,426

-

-

228,348

Total Personal Banking

3,766,574

-

27,396

-

1,321

3,795,291

Business Banking:

Commercial real estate loans

1,398,652

46,557

161,906

1,284

-

1,608,399

Commercial loans

345,612

12,045

43,040

1,904

-

402,601

Total Business Banking

1,744,264

58,602

204,946

3,188

-

2,011,000

$ 5,510,838

58,602

232,342

3,188

1,321

5,806,291

 

 

Northwest Bancshares, Inc. and Subsidiaries

Allowance for loan losses

(Dollars in thousands)

Quarter ended

Year ended

March 31, 

December 31, 

2014

2013

2013

2012

Allowance for loan losses 

Beginning balance

$   71,348

73,219

73,219

71,138

Provision

7,485

7,158

18,519

26,338

Charge-offs residential mortgage

(459)

(679)

(2,501)

(4,295)

Charge-offs home equity

(372)

(370)

(2,239)

(4,066)

Charge-offs other consumer

(1,716)

(1,404)

(6,055)

(5,919)

Charge-offs commercial real estate

(932)

(3,990)

(10,042)

(9,919)

Charge-offs commercial

(770)

(2,680)

(5,007)

(6,254)

Recoveries

1,650

755

5,454

6,196

Ending balance

$   76,234

72,009

71,348

73,219

Net charge-offs to average loans, annualized

0.18%

0.59%

0.36%

0.43%

 

 

Northwest Bancshares, Inc. and Subsidiaries

Municipal securities portfolio

(Dollars in thousands)

March 31, 2014

As a % of

Market

Amortized

Unrealized

amortized

 value 

cost

gain/ (loss)

cost

Municipal securities by state:

Pennsylvania

School districts

$     74,904

73,474

1,430

46.7%

General obligations

28,986

28,267

719

18.0%

Revenue bonds

1,080

1,080

-

0.7%

Total Pennsylvania

104,970

102,821

2,149

65.4%

New York

15,924

15,668

256

10.0%

Ohio

6,183

5,976

207

3.7%

All other states

34,252

32,837

1,415

20.9%

$   161,329

157,302

4,027

December 31, 2013

As a % of

Market

Amortized

Unrealized

amortized

 value 

cost

gain

cost

Municipal securities by state:

Pennsylvania

School districts

$     76,736

75,767

969

47.1%

General obligations

28,745

28,264

481

17.6%

Revenue bonds

1,071

1,080

(9)

0.7%

Total Pennsylvania

106,552

105,111

1,441

65.4%

New York

15,857

15,665

192

9.7%

Ohio

5,980

5,975

5

3.7%

All other states

34,828

34,014

814

21.2%

$   163,217

160,765

2,452

 

 

Northwest Bancshares, Inc. and Subsidiaries

Average balance sheet 

(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, 

2014

2013

 Average 

 Interest 

 Avg. 

 Average 

 Interest 

 Avg. 

 Balance 

 Yield/ 

 Balance 

 Yield/ 

 Cost (g) 

 Cost (g) 

Assets:

Interest-earning assets:

   Loans receivable (a) (b) (d)

$ 5,823,527

69,916

4.87%

$ 5,638,332

73,527

5.22%

   Mortgage-backed securities (c) 

621,146

2,793

1.80%

725,524

3,441

1.90%

   Investment securities (c) (d) 

507,354

3,627

2.86%

470,386

4,079

3.47%

   FHLB stock

43,715

275

2.52%

46,868

38

0.32%

   Other interest-earning deposits

351,615

200

0.23%

452,385

251

0.22%

Total interest-earning assets 

7,347,357

76,811

4.23%

7,333,495

81,336

4.44%

Noninterest-earning assets (e)

584,754

585,516

Total assets

$ 7,932,111

$ 7,919,011

Liabilities and shareholders' equity:

Interest-bearing liabilities:

   Savings accounts

$ 1,208,349

804

0.27%

$ 1,180,487

894

0.31%

   Interest-bearing demand accounts

851,723

139

0.07%

840,264

139

0.07%

   Money market deposit accounts

1,173,957

782

0.27%

1,107,522

742

0.27%

   Time deposits

1,642,224

4,765

1.18%

1,849,782

6,039

1.32%

   Borrowed funds (f)

881,187

6,557

3.02%

853,487

6,426

3.05%

   Junior subordinated debentures

103,094

1,157

4.49%

103,094

1,405

5.45%

Total interest-bearing liabilities

5,860,534

14,204

0.98%

5,934,636

15,645

1.07%

Noninterest-bearing demand accounts

815,117

768,071

Noninterest-bearing liabilities

105,027

77,106

Total liabilities

6,780,678

6,779,813

Shareholders' equity

1,151,433

1,139,198

Total liabilities and shareholders' equity

$ 7,932,111

$ 7,919,011

Net interest income/ Interest rate spread

62,607

3.25%

65,691

3.37%

Net interest-earning assets/ Net interest margin

$ 1,486,823

3.45%

$ 1,398,859

3.58%

Ratio of interest-earning assets to

 interest-bearing liabilities

 1.25X 

 1.24X 

(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 securities sold under agreements to repurchase.

(g) Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 4.83% and 5.18%,

      respectively,  Investment securities - 2.16% and 2.52%, respectively, Interest-earning assets - 4.16% and

      4.35%, respectively. GAAP basis net interest rate spreads were 3.18% and  3.28%, respectively, and

      GAAP basis net interest margins were 3.38% and 3.49%, respectively.

 

 

Northwest Bancshares, Inc. and Subsidiaries

Average balance sheet 

(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, 2014

December 31, 2013

 Average 

 Interest 

 Avg. 

 Average 

 Interest 

 Avg. 

 Balance 

 Yield/ 

 Balance 

 Yield/ 

 Cost (g) 

 Cost (g) 

Assets:

Interest-earning assets:

   Loans receivable (a) (b) (d)

$ 5,823,527

69,916

4.87%

$ 5,762,308

71,421

4.96%

   Mortgage-backed securities (c) 

621,146

2,793

1.80%

653,526

2,956

1.81%

   Investment securities (c) (d) 

507,354

3,627

2.86%

528,612

3,740

2.83%

   FHLB stock

43,715

275

2.52%

43,715

180

1.65%

   Other interest-earning deposits

351,615

200

0.23%

373,694

249

0.26%

Total interest-earning assets 

7,347,357

76,811

4.23%

7,361,855

78,546

4.27%

Noninterest-earning assets (e)

584,754

541,511

Total assets

$ 7,932,111

$ 7,903,366

Liabilities and shareholders' equity:

Interest-bearing liabilities:

   Savings accounts

$ 1,208,349

804

0.27%

$ 1,191,476

919

0.31%

   Interest-bearing demand accounts

851,723

139

0.07%

851,356

144

0.07%

   Money market deposit accounts

1,173,957

782

0.27%

1,160,520

783

0.27%

   Time deposits

1,642,224

4,765

1.18%

1,690,251

5,065

1.19%

   Borrowed funds (f)

881,187

6,557

3.02%

889,920

6,711

2.99%

   Junior subordinated debentures

103,094

1,157

4.49%

103,094

1,183

4.49%

Total interest-bearing liabilities

5,860,534

14,204

0.98%

5,886,617

14,805

1.00%

Noninterest-bearing demand accounts

815,117

808,732

Noninterest-bearing liabilities

105,027

64,338

Total liabilities

6,780,678

6,759,687

Shareholders' equity

1,151,433

1,143,679

Total liabilities and shareholders' equity

$ 7,932,111

$ 7,903,366

Net interest income/ Interest rate spread

62,607

3.25%

63,741

3.27%

Net interest-earning assets/ Net interest margin

$ 1,486,823

3.45%

$ 1,475,238

3.46%

Ratio of interest-earning assets to

 interest-bearing liabilities

 1.25X 

 1.25X 

(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 securities sold under agreements to repurchase.

(g) Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 4.83% and 4.92%,  

      respectively, Investment securities - 2.16%  and 2.12%, respectively, Interest-earning assets - 4.16% and

      4.19%, respectively. GAAP basis net interest rate spreads were 3.18% and 3.19%, respectively, and

      GAAP basis net interest margins were 3.38% and 3.38%, respectively.

 

SOURCE Northwest Bancshares, Inc.



RELATED LINKS

http://www.northwestsavingsbank.com