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

Jul 21, 2014, 10:46 ET from Northwest Bancshares, Inc.

WARREN, Pa., July 21, 2014 /PRNewswire/ -- Northwest Bancshares, Inc. (NasdaqGS: NWBI) announced net income for the quarter ended June 30, 2014 of $12.7 million, or $0.14 per diluted share.  This represents a decrease of $763,000, or 5.7%, compared to the same quarter last year when net income was $13.5 million, or $0.15 per diluted share, and a decrease of $1.9 million, or 13.1%, compared to the quarter ended March 31, 2014 when net income was $14.6 million, or $0.16 per diluted share.  The annualized returns on average shareholders' equity and average assets for the quarter ended June 30, 2014 were 4.77% and 0.64% compared to 4.79% and 0.68% for the same quarter last year and 5.16% and 0.75% for the quarter ended March 31, 2014. 

The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.13 per share payable on August 14, 2014, to shareholders of record as of July 31, 2014.  This represents the 79th consecutive quarter in which the Company has paid a cash dividend. 

In making this announcement, William J. Wagner, President and CEO, noted, "The deterioration of several commercial credits negatively impacted what was otherwise consistent core earnings highlighted by a 2.1% increase in net interest income compared to the previous quarter. This improvement was the result of loan growth of nearly $35 million and an increase in checking accounts of more than $38 million. Looking at the other elements of income, we are pleased to report that noninterest income increased by 27.7 % while noninterest expense was held to just a 1.9% increase over the previous year. Finally, we were excited to be recognized for the fourth time in the last five years by J.D. Power & Associates as the 'Highest Rated Financial Institution for Customer Satisfaction in the Mid-Atlantic Region'. Further recognition was received from Forbes who named Northwest as 'One of America's 50 Most Trustworthy Financial Companies' and from Keefe, Bruyette & Woods who included Northwest as one of 31 companies on their 'Bank Honor Roll'."

Net interest income decreased by $1.2 million, or 1.9%, to $62.1 million for the quarter ended June 30, 2014, from $63.3 million for the quarter ended June 30, 2013, as interest income on both loans receivable and investment securities decreased from the prior year. These decreases were partially offset by a $1.2 million decrease in interest paid on deposit accounts and borrowed funds. These changes from the previous year were due primarily to the continued low level of market interest rates. Net interest income, however, improved by $1.3 million, or 2.1%, over the prior quarter due primarily to growth of $24.7 million, or 1.2%, in commercial loans.

The provision for loan losses increased by $2.9 million, or 53.3%, to $8.3 million for the quarter ended June 30, 2014, from $5.4 million for the quarter ended June 30, 2013 and increased by $800,000 compared to the quarter ended March 31, 2014.  This increase is due primarily to the deterioration of several commercial loans which required a provision of $5.5 million.  The total required provision for the quarter was lessened by the continued improvement in overall asset quality with loans 90 days or more delinquent decreasing $12.2 million, or 19.3%, and total nonaccrual loans decreasing $23.8 million, or 19.7%, compared to a year ago and the continued recovery of previously charged-off loans. Net charge-offs for the current quarter were $13.1 million, or 0.90% of average loans compared to $4.8 million, or 0.34% for the same quarter last year.  This increase resulted from the charge-off of two commercial loans for $6.8 million and $1.3 million, respectively.  At June 30, 2014, the allowance for loan losses was $71.4 million, or 1.21% of total loans, compared to $72.6 million, or 1.28% of total loans, at June 30, 2013. 

Noninterest income increased by $3.7 million, or 27.7%, to $17.1 million for the quarter ended June 30, 2014, from $13.4 million for the quarter ended June 30, 2013.  This increase is due primarily to a $1.7 million decrease in the loss on real estate owned and an increase in other operating income of $823,000, as a result of increased Federal Home Loan Bank dividends. Additionally, trust and other financial services income increased by $792,000, due primarily to the acquisition of Evans Capital Management, Inc. on January 1, 2014. 

Noninterest expense increased by $1.0 million, or 1.9%, to $53.8 million for the quarter ended June 30, 2014, from $52.8 million for the quarter ended June 30, 2013. This increase was due primarily to an $838,000 increase in marketing expense as the result of robust marketing activity in the current quarter to promote loan and checking growth. Additionally, professional services increased by $576,000, due primarily to compliance related consulting engagements as we continue to strengthen our regulatory compliance management system.

Net income for the six-month period ended June 30, 2014 of $27.4 million represents a decrease of $1.4 million, or 4.9%, compared to net income of $28.8 million for the six-month period ended June 30, 2013.  Diluted earnings per share for the six-month period ended June 30, 2014 decreased to $0.30 per share from $0.32 per share in the same period last year.  The annualized returns on average shareholders' equity and average assets were 4.97% and 0.70%, respectively, for the current six-month period compared to 5.12% and 0.73%, respectively, in the prior year.   

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 ("NWBI"). Additional information regarding Northwest Bancshares, Inc. and Northwest Savings Bank 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)

June 30,

December 31,

Assets

2014

2013

Cash and cash equivalents

$                      97,467

98,122

Interest-earning deposits in other financial institutions

287,867

293,149

Federal funds sold and other short-term investments

634

634

Marketable securities available-for-sale (amortized cost of $972,258 and $1,022,078)

977,786

1,016,767

Marketable securities held-to-maturity (fair value of $117,670 and $124,061)

114,154

121,366

Total cash, interest-earning deposits and marketable securities

1,477,908

1,530,038

Residential mortgage loans held for sale

-

221

Residential mortgage loans

2,485,740

2,482,783

Home equity loans 

1,066,943

1,083,939

Other consumer loans

231,974

228,348

Commercial real estate loans

1,694,882

1,608,399

Commercial loans

406,195

402,601

Total loans receivable

5,885,734

5,806,291

Allowance for loan losses

(71,442)

(71,348)

Loans receivable, net

5,814,292

5,734,943

Federal Home Loan Bank stock, at cost

43,986

43,715

Accrued interest receivable

21,756

21,821

Real estate owned, net

14,915

18,203

Premises and Equipment, net

145,344

146,139

Bank owned life insurance

142,223

140,172

Goodwill and other intangible assets

175,988

174,463

Other intangible assets

3,694

2,319

Other assets

62,210

69,663

Total assets

$              7,902,316

7,881,476

Liabilities and Shareholders' equity

Liabilities

Noninterest-bearing demand deposits

$                   872,661

789,135

Interest-bearing demand deposits

901,486

852,809

Money market deposit accounts

1,183,228

1,167,954

Savings deposits

1,236,307

1,191,584

Time deposits

1,580,240

1,667,397

Total deposits

5,773,922

5,668,879

Borrowed funds

869,335

881,645

Advances by borrowers for taxes and insurance

37,677

26,669

Accrued interest payable

816

888

Other liabilities

45,000

43,499

Junior subordinated debentures

103,094

103,094

Total liabilities

6,829,844

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, 94,949,695 shares and 94,243,713 shares issued and outstanding, respectively

949

943

Paid-in-capital

626,213

619,678

Retained earnings

472,726

571,164

Unallocated common stock of Employee Stock Ownership Plan

(22,200)

(23,083)

Accumulated other comprehensive loss

(5,216)

(11,900)

Total shareholders' equity

1,072,472

1,156,802

Total liabilities and shareholders' equity

$              7,902,316

7,881,476

Equity to assets

13.57%

14.68%

Tangible common equity to assets

11.56%

12.72%

Book value per share

$                      11.30

12.27

Tangible book value per share

$                        9.40

10.40

Closing market price per share

$                      13.57

14.78

Full time equivalent employees

2,047

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

June 30,

March 31,

2014

2013

2014

Interest income:

Loans receivable

$         70,797

71,987

69,373

Mortgage-backed securities

2,666

3,308

2,793

Taxable investment securities

1,014

1,034

1,080

Tax-free investment securities

1,598

2,094

1,655

Interest-earning deposits

286

340

200

Total interest income

76,361

78,763

75,101

Interest expense:

Deposits

6,421

7,404

6,490

Borrowed funds

7,793

8,032

7,714

Total interest expense

14,214

15,436

14,204

Net interest income

62,147

63,327

60,897

Provision for loan losses

8,285

5,405

7,485

Net interest income after provision

for loan losses

53,862

57,922

53,412

Noninterest income:

Gain on sale of investments

349

19

3,348

Service charges and fees

9,042

9,037

8,408

Trust and other financial services income

3,055

2,263

3,047

Insurance commission income

2,237

2,190

2,564

Loss on real estate owned, net

(562)

(2,285)

(135)

Income from bank owned life insurance

1,050

1,088

1,001

Mortgage banking income

265

236

249

Other operating income

1,688

865

1,175

Total noninterest income

17,124

13,413

19,657

Noninterest expense:

Compensation and employee benefits

28,543

28,156

27,972

Premises and occupancy costs

5,740

5,744

6,557

Office operations

3,868

3,866

3,757

Processing expenses

6,639

7,390

6,589

Marketing expenses

2,931

2,093

1,637

Federal deposit insurance premiums

1,338

1,424

1,297

Professional services

1,775

1,199

2,062

Amortization of intangible assets

331

349

331

Real estate owned expense

459

600

639

Other expense

2,182

1,985

2,322

Total noninterest expense

53,806

52,806

53,163

Income before income taxes

17,180

18,529

19,906

Income tax expense

4,465

5,051

5,266

Net income

$         12,715

13,478

14,640

Basic earnings per share

$              0.14

0.15

0.16

Diluted earnings per share

$              0.14

0.15

0.16

Annualized return on average equity

4.77%

4.79%

5.16%

Annualized return on average assets

0.64%

0.68%

0.75%

Basic common shares outstanding

91,491,654

90,423,717

91,154,998

Diluted common shares outstanding

92,531,142

90,917,136

92,353,312

 

 

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Income

(Dollars in thousands, except per share amounts)

Six months ended 

June 30,

2014

2013

Interest income:

Loans receivable

$        140,170

144,960

Mortgage-backed securities

5,459

6,749

Taxable investment securities

2,094

1,939

Tax-free investment securities

3,253

4,157

Interest-earning deposits

486

591

Total interest income

151,462

158,396

Interest expense:

Deposits

12,911

15,218

Borrowed funds

15,507

15,863

Total interest expense

28,418

31,081

Net interest income

123,044

127,315

Provision for loan losses

15,770

12,563

Net interest income after provision

for loan losses

107,274

114,752

Noninterest income:

Gain on sale of investments

3,697

120

Service charges and fees

17,450

17,728

Trust and other financial services income

6,102

4,467

Insurance commission income

4,801

4,485

Loss on real estate owned, net

(697)

(2,415)

Income from bank owned life insurance

2,051

2,173

Mortgage banking income

514

1,192

Other operating income

2,863

2,041

Total noninterest income

36,781

29,791

Noninterest expense:

Compensation and employee benefits

56,515

56,086

Premises and occupancy costs

12,297

11,897

Office operations

7,625

7,134

Processing expenses

13,228

13,243

Marketing expenses

4,568

3,993

Federal deposit insurance premiums

2,635

2,862

Professional services

3,837

2,892

Amortization of intangible assets

662

697

Real estate owned expense

1,098

1,199

Other expense

4,504

4,274

Total noninterest expense

106,969

104,277

Income before income taxes

37,086

40,266

Income tax expense

9,731

11,490

Net income

$           27,355

28,776

Basic earnings per share

$               0.30

0.32

Diluted earnings per share

$               0.30

0.32

Annualized return on average equity

4.97%

5.12%

Annualized return on average assets

0.70%

0.73%

Basic common shares outstanding

91,324,169

90,413,780

Diluted common shares outstanding

92,442,631

90,898,038

 

 

Northwest Bancshares, Inc. and Subsidiaries

Asset quality

(Dollars in thousands)

June 30,

2014

March 31, 

2014

June 30, 2013

December 31,

2013

Nonaccrual loans current:

Residential mortgage loans

$                1,112

1,064

1,564

1,361

Home equity loans

1,682

1,771

859

835

Other consumer loans

112

136

69

98

Commercial real estate loans

24,935

26,564

27,882

17,866

Commercial loans

10,494

19,603

15,687

13,357

Total nonaccrual loans current

$             38,335

49,138

46,061

33,517

Nonaccrual loans delinquent 30 days to 59 days:

Residential mortgage loans

$                     107

741

18

427

Home equity loans

75

155

81

404

Other consumer loans

60

36

14

15

Commercial real estate loans

3,788

4,118

4,536

3,468

Commercial loans

162

5

172

7,650

Total nonaccrual loans delinquent 30 days to 59 days

$                4,192

5,055

4,821

11,964

Nonaccrual loans delinquent 60 days to 89 days:

Residential mortgage loans

$                     936

1,914

1,964

864

Home equity loans

274

485

198

280

Other consumer loans

40

99

60

87

Commercial real estate loans

1,584

902

1,848

2,036

Commercial loans

122

95

2,104

716

Total nonaccrual loans delinquent 60 days to 89 days

$                2,956

3,495

6,174

3,983

Nonaccrual loans delinquent 90 days or more:

Residential mortgage loans

$             21,994

20,564

23,730

24,625

Home equity loans

7,810

8,420

8,607

8,344

Other consumer loans

1,966

1,818

1,706

2,057

Commercial real estate loans

15,290

16,098

20,872

18,433

Commercial loans

4,214

4,494

8,595

4,298

Total nonaccrual loans delinquent 90 days or more

$             51,274

51,394

63,510

57,757

Total nonaccrual loans

$             96,757

109,082

120,566

107,221

June 30,

March 31,

June 30,

December 31,

2014

2014

2013

2013

Nonaccrual loans

$             96,757

109,082

120,566

107,221

Loans 90 days past maturity and still accruing

271

709

871

690

   Nonperforming loans

97,028

109,791

121,437

107,911

Real estate owned, net

14,915

16,692

21,269

18,203

   Nonperforming assets

$          111,943

126,483

142,706

126,114

Nonaccrual troubled debt restructuring *

$             23,949

34,268

42,501

28,889

Accruing troubled debt restructuring

39,844

40,243

44,016

50,277

Total troubled debt restructuring

$             63,793

74,511

86,517

79,166

Nonperforming loans to total loans

1.65%

1.88%

2.13%

1.86%

Nonperforming assets to total assets

1.42%

1.59%

1.79%

1.60%

Allowance for loan losses to total loans

1.21%

1.30%

1.28%

1.23%

Allowance for loan losses to nonperforming loans

73.63%

69.44%

59.78%

66.12%

* 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)

June 30,

March 31,

June 30,

December 31,

2014

*

2014

*

2013

*

2013

*

Loans delinquent 30 days to 59 days:

Residential mortgage loans

71

$         3,842

0.2%

352

$      26,874

1.1%

77

$         3,741

0.2%

374

$      27,486

1.1%

Home equity loans

123

4,193

0.4%

172

5,449

0.5%

174

4,993

0.5%

213

6,946

0.6%

Consumer loans

953

4,355

1.9%

749

3,412

1.5%

1,026

4,334

1.9%

1,010

4,515

2.0%

Commercial real estate loans

79

8,247

0.5%

84

26,518

1.6%

74

7,982

0.5%

73

8,449

0.5%

Commercial loans

35

1,146

0.3%

41

1,375

0.3%

31

952

0.2%

34

9,243

2.3%

Total loans delinquent 30 days to 59 days

1,261

$      21,783

0.4%

1,398

$      63,628

1.1%

1,382

22,002

0.4%

1,704

$      56,639

1.0%

Loans delinquent 60 days to 89 days:

Residential mortgage loans

81

$         6,024

0.2%

46

$         3,674

0.1%

101

$         8,516

0.4%

103

$         7,568

0.3%

Home equity loans

45

1,210

0.1%

42

1,437

0.1%

50

1,361

0.1%

67

2,243

0.2%

Consumer loans

363

1,454

0.6%

330

1,289

0.6%

368

1,470

0.7%

507

1,866

0.8%

Commercial real estate loans

31

2,267

0.1%

33

2,570

0.2%

41

3,170

0.2%

35

3,968

0.2%

Commercial loans

16

709

0.2%

9

473

0.1%

18

2,389

0.6%

16

1,555

0.4%

Total loans delinquent 60 days to 89 days

536

$      11,664

0.2%

460

$         9,443

0.2%

578

16,906

0.3%

728

$      17,200

0.3%

Loans delinquent 90 days or more:

Residential mortgage loans

251

$      21,994

0.9%

236

$      20,564

0.8%

250

$      23,730

1.0%

273

$      24,625

1.0%

Home equity loans

168

7,810

0.7%

176

8,420

0.8%

194

8,607

0.8%

171

8,344

0.8%

Consumer loans

412

1,966

0.8%

391

1,818

0.8%

379

1,706

0.8%

470

2,057

0.9%

Commercial real estate loans

118

15,290

0.9%

116

16,098

1.0%

128

20,872

1.3%

124

18,433

1.1%

Commercial loans

34

4,214

1.0%

33

4,494

1.1%

53

8,595

2.2%

31

4,298

1.1%

Total loans delinquent 90 days or more

983

$      51,274

0.9%

952

$      51,394

0.9%

1,004

63,510

1.1%

1,069

$      57,757

1.0%

Total loans delinquent

2,780

$      84,721

1.4%

2,810

$   124,465

2.1%

2,964

$   102,418

1.8%

3,501

$   131,596

2.3%

* - 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 June 30, 2014

(Dollars in thousands)

Recorded

investment

Special

in loans

Pass

mention

Substandard

 Doubtful 

 Loss 

receivable

Personal Banking:

Residential mortgage loans

$         2,468,039

-

16,313

-

1,388

2,485,740

Home equity loans

1,059,133

-

7,810

-

-

1,066,943

Other consumer loans

230,707

-

1,267

-

-

231,974

Total Personal Banking

3,757,879

-

25,390

-

1,388

3,784,657

Business Banking:

Commercial real estate loans

1,489,428

56,711

145,622

3,121

-

1,694,882

Commercial loans

354,424

16,588

31,432

3,751

-

406,195

Total Business Banking

1,843,852

73,299

177,054

6,872

-

2,101,077

$         5,601,731

73,299

202,444

6,872

1,388

5,885,734

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

Six months ended

June 30, 

June 30, 

2014

2013

2014

2013

Allowance for loan losses 

Beginning balance

$             76,234

72,009

71,348

73,219

Provision

8,285

5,405

15,770

12,563

Charge-offs residential mortgage

(883)

(777)

(1,342)

(1,456)

Charge-offs home equity

(593)

(805)

(965)

(1,175)

Charge-offs other consumer

(1,450)

(1,280)

(3,166)

(2,684)

Charge-offs commercial real estate

(2,743)

(2,696)

(3,675)

(6,686)

Charge-offs commercial

(9,351)

(542)

(10,121)

(3,222)

Recoveries

1,943

1,276

3,593

2,031

Ending balance

$             71,442

72,590

71,442

72,590

Net charge-offs to average loans, annualized

0.90%

0.34%

0.54%

0.47%

 

 

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 June 30, 

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)

$  5,833,540

71,337

4.90%

$  5,623,784

72,548

5.16%

   Mortgage-backed securities (c) 

601,066

2,666

1.77%

726,583

3,308

1.82%

   Investment securities (c) (d) 

507,315

3,472

2.74%

531,802

4,255

3.20%

   FHLB stock

43,944

697

6.34%

48,110

34

0.28%

   Other interest-earning deposits

424,434

286

0.27%

513,930

340

0.26%

Total interest-earning assets 

7,410,299

78,458

4.24%

7,444,209

80,485

4.32%

Noninterest earning assets (e)

530,582

531,771

Total assets

$  7,940,881

$  7,975,980

Liabilities and shareholders' equity:

Interest-bearing liabilities:

   Savings deposits

$  1,239,563

821

0.27%

$  1,209,783

900

0.30%

   Interest-bearing demand deposits

896,014

149

0.07%

873,804

149

0.07%

   Money market deposit accounts

1,182,542

792

0.27%

1,121,579

748

0.27%

   Time deposits

1,598,523

4,659

1.17%

1,791,030

5,607

1.26%

   Borrowed funds (f)

872,653

6,623

3.04%

866,476

6,612

3.06%

   Junior subordinated debentures

103,094

1,170

4.49%

103,094

1,420

5.45%

Total interest-bearing liabilities

5,892,389

14,214

0.97%

5,965,766

15,436

1.04%

Noninterest-bearing demand deposits

852,253

778,468

Noninterest bearing liabilities

128,072

102,191

Total liabilities

6,872,714

6,846,425

Shareholders' equity

1,068,167

1,129,555

Total liabilities and shareholders' equity

$  7,940,881

$  7,975,980

Net interest income/ Interest rate spread

64,244

3.27%

65,049

3.28%

Net interest-earning assets/ Net interest margin

$  1,517,910

3.47%

$  1,478,443

3.50%

Ratio of interest-earning assets to

 interest-bearing liabilities

 1.26X 

 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 - 4.87% and 5.12%, respectively, Investment securities - 2.06% 

       and 2.35%, respectively, Interest-earning assets - 4.17% and 4.23%, respectively. GAAP basis net interest rate spreads were 3.20% and 

      3.19%, respectively, and GAAP basis net interest margins were 3.39% and 3.40%, 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.

 Six months ended June 30, 

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)

$  5,828,500

141,254

4.89%

$  5,631,110

146,075

5.19%

   Mortgage-backed securities (c) 

611,050

5,459

1.79%

726,057

6,749

1.86%

   Investment securities (c) (d) 

507,334

7,099

2.80%

500,881

8,334

3.33%

   FHLB stock

43,830

973

4.44%

47,492

71

0.30%

   Other interest-earning deposits

370,292

486

0.26%

457,871

591

0.26%

Total interest-earning assets 

7,361,006

155,271

4.25%

7,363,411

161,820

4.40%

Noninterest earning assets (e)

575,490

584,030

Total assets

$  7,936,496

$  7,947,441

Liabilities and shareholders' equity:

Interest-bearing liabilities:

   Savings deposits

$  1,224,042

1,624

0.27%

$  1,195,216

1,794

0.30%

   Interest-bearing demand deposits

873,972

288

0.07%

857,121

289

0.07%

   Money market deposit accounts

1,178,202

1,574

0.27%

1,114,553

1,490

0.27%

   Time deposits

1,621,745

9,425

1.17%

1,820,244

11,645

1.29%

   Borrowed funds (f)

876,897

13,180

3.03%

860,017

13,038

3.06%

   Junior subordinated debentures

103,094

2,327

4.49%

103,094

2,825

5.45%

Total interest-bearing liabilities

5,877,952

28,418

0.97%

5,950,245

31,081

1.05%

Noninterest-bearing demand deposits

833,750

766,578

Noninterest bearing liabilities

114,994

96,297

Total liabilities

6,826,696

6,813,120

Shareholders' equity

1,109,800

1,134,321

Total liabilities and shareholders' equity

$  7,936,496

$  7,947,441

Net interest income/ Interest rate spread

126,853

3.28%

130,739

3.35%

Net interest-earning assets/ Net interest margin

$  1,483,054

3.45%

$  1,413,166

3.55%

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 - 4.85% and 5.15%, respectively, Investment securities - 2.11% 

       and 2.43%, respectively, Interest-earning assets - 4.17% and 4.30%, respectively. GAAP basis net interest rate spreads were 3.20% and 

      3.25%, respectively, and GAAP basis net interest margins were 3.37% and 3.46%, 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 

 Quarter ended 

June 30, 2014

March 31, 2014

 Average 

 Interest 

 Avg. 

 Average 

 Interest 

 Avg. 

 Balance 

 Yield/ 

 Balance 

 Yield/ 

 Cost (g) 

 Cost (g) 

Assets:

Interest-earning assets:

   Loans receivable (a) (b) (d)

$  5,833,540

71,337

4.90%

$  5,823,527

69,916

4.87%

   Mortgage-backed securities (c) 

601,066

2,666

1.77%

621,146

2,793

1.80%

   Investment securities (c) (d) 

507,315

3,472

2.74%

507,354

3,627

2.86%

   FHLB stock

43,944

697

6.34%

43,715

275

2.52%

   Other interest-earning deposits

424,434

286

0.27%

351,615

200

0.23%

Total interest-earning assets 

7,410,299

78,458

4.24%

7,347,357

76,811

4.23%

Noninterest earning assets (e)

530,582

584,754

Total assets

$  7,940,881

$  7,932,111

Liabilities and shareholders' equity:

Interest-bearing liabilities:

   Savings deposits

$  1,239,563

821

0.27%

$  1,208,349

804

0.27%

   Interest-bearing demand deposits

896,014

149

0.07%

851,723

139

0.07%

   Money market deposit accounts

1,182,542

792

0.27%

1,173,957

782

0.27%

   Time deposits

1,598,523

4,659

1.17%

1,642,224

4,765

1.18%

   Borrowed funds (f)

872,653

6,623

3.04%

881,187

6,557

3.02%

   Junior subordinated debentures

103,094

1,170

4.49%

103,094

1,157

4.49%

Total interest-bearing liabilities

5,892,389

14,214

0.97%

5,860,534

14,204

0.98%

Noninterest-bearing demand deposits

852,253

815,117

Noninterest bearing liabilities

128,072

105,027

Total liabilities

6,872,714

6,780,678

Shareholders' equity

1,068,167

1,151,433

Total liabilities and shareholders' equity 

$  7,940,881

$  7,932,111

Net interest income/ Interest rate spread

64,244

3.27%

62,607

3.25%

Net interest-earning assets/ Net interest margin

$  1,517,910

3.47%

$  1,486,823

3.45%

Ratio of interest-earning assets to

 interest-bearing liabilities

 1.26X 

 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 - 4.87% and 4.83%, respectively, Investment securities - 2.06% 

       and 2.16%, respectively, Interest-earning assets - 4.17% and 4.16%, respectively. GAAP basis net interest rate spreads were 3.20% and 

      3.18%, respectively, and GAAP basis net interest margins were 3.39% and 3.38%, respectively.

 

 

SOURCE Northwest Bancshares, Inc.



RELATED LINKS

www.northwestsavingsbank.com