NORTHWEST BANCSHARES, INC. WARREN, Pa., Oct. 24, 2016 /PRNewswire/ -- Northwest Bancshares, Inc. (NasdaqGS: NWBI) announced net income for the quarter ended September 30, 2016 of $14.2 million, or $0.14 per diluted share. This represents an increase of $1.3 million compared to the same quarter last year when net income was $12.9 million or $0.13 per diluted share. The annualized returns on average shareholders' equity and average assets for the quarter ended September 30, 2016 were 4.89% and 0.63% compared to 4.54% and 0.59% for the same quarter last year.
The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.15 per share payable on November 17, 2016, to shareholders of record as of November 3, 2016. This is the 88th consecutive quarter in which the Company has paid a cash dividend. Based on the current market value of the Company's stock, this represents an annualized dividend yield of approximately 3.8%.
Earnings for the current quarter include acquisition costs of $7.2 million related to the September 9, 2016 purchase of 18 branches from First Niagara Bank, and $5.1 million of stock-based compensation costs associated with the termination of the Northwest Savings Bank Employee Stock Ownership Plan ("ESOP"). Excluding the after-tax impact of these expenses totaling $8.3 million, non-GAAP net operating income for the quarter ended September 30, 2016 was $22.5 million, or $0.22 per diluted share, compared to non-GAAP net operating income of $17.9 million, or $0.19 per diluted share in the same quarter last year. The non-GAAP annualized returns on average shareholders' equity and average assets for the quarter ended September 30, 2016 were 7.74% and 0.99% compared to 6.30% and 0.82% in the previous year. The aforementioned termination of the ESOP includes the cancellation of approximately 1,367,000 shares of common stock as of September 30, 2016.
In making this announcement, William J. Wagner, President and CEO, noted, "The $4.6 million, or 26%, increase in non-GAAP quarterly earnings over the previous year primarily reflects the impact of the merger of Lorain National Bank, which occurred in August 2015, and the refinancing of $700.0 million of fixed-rate FHLB advances, which occurred in May 2016. Since the purchase of the Buffalo branches occurred late in the current quarter, there was limited impact on earnings. However, we anticipate the full impact from this transaction to be realized in the fourth quarter of 2016."
Net interest income increased by $11.7 million, or 17.5%, to $78.6 million for the quarter ended September 30, 2016, from $66.9 million for the quarter ended September 30, 2015. This increase is due primarily to a $6.3 million, or 8.3%, increase in interest income on loans as a result of a $647.0 million increase in the Company's loan portfolio from a year ago. Also contributing to the increase in net interest income was a $6.2 million decrease in interest expense on borrowed funds due primarily to the payoff of Federal Home Loan Bank ("FHLB") advances with the funds received by assuming the deposits from the First Niagara branch purchase. Additionally, interest paid on deposits decreased by $510,000 for the quarter due primarily to the change in deposit mix. Partially offsetting these improvements was a $1.1 million decrease in interest income on investment securities as the portfolio decreased due to the cash flow from these securities being used to fund loan growth. As a result of these changes, the Company's net interest margin increased to 3.88% for the quarter ended September 30, 2016 from 3.50% for the same quarter last year.
The provision for loan losses increased by $2.3 million, or 74.9%, to $5.5 million for the quarter ended September 30, 2016, from $3.2 million for the quarter ended September 30, 2015. This increase is due primarily to the downgrade of four commercial banking relationships requiring an additional $1.9 million of combined reserves. However, overall credit quality remained steady while classified loans to total loans decreased to 2.73% at September 30, 2016 from 2.81% at September 30, 2015 and total loan delinquency to total loans decreased to 1.11% at September 30, 2016 from 1.20% at September 30, 2015.
Noninterest income increased by $2.7 million, or 14.8%, to $20.8 million for the quarter ended September 30, 2016, from $18.1 million for the quarter ended September 30, 2015. Contributing to this increase was an increase in mortgage banking income of $1.6 million, or 606.4%, which is the result of resuming the sale of mortgage loans originated by the Wholesale Lending Division. Additionally, service charges and fees increased by $1.1 million, or 10.7%, which is attributable to the growth in checking accounts from both the LNB Bancorp, Inc. ("LNB") acquisition and internal growth initiatives. As was previously announced, the Company's insurance subsidiary signed an agreement of its intentions to acquire an insurance agency in Warren, Pennsylvania on November 1, 2016 which is anticipated to provide approximately $500,000 of additional annual insurance commission revenue.
Noninterest expense increased by $11.2 million, or 17.6%, to $75.0 million for the quarter ended September 30, 2016, from $63.8 million for the quarter ended September 30, 2015. This increase resulted primarily from an $8.4 million, or 27.3%, increase in compensation and employee benefits due to the costs associated with the termination of the ESOP and the employees added from recent acquisitions. The other increases for the current quarter compared to the prior year are primarily attributable to incremental expenses from the LNB acquisition.
Net income for the nine month period ended September 30, 2016 was $25.2 million, or $0.25 per diluted share. This represents a decrease of $19.1 million, or 43.2%, compared to the nine month period ended September 30, 2015, when net income was $44.3 million, or $0.48 per diluted share. The annualized returns on average shareholders' equity and average assets for the nine month period ended September 30, 2016 were 2.90% and 0.38% compared to 5.47% and 0.73% for the same period last year. This decrease is due primarily to a $37.0 million penalty incurred from the prepayment of FHLB borrowings, acquisition and restructuring expenses of $11.2 million, and ESOP expense of $5.1 million. Offsetting these items which negatively impacted net income was a $34.8 million, or 18.1%, increase in net interest income.
Non-GAAP net operating income for the nine month period ended September 30, 2016, which excludes the after-tax impact of the aforementioned FHLB prepayment penalty, restructuring and acquisition expenses, and ESOP costs totaling $34.0 million, was $59.2 million, or $0.59 per diluted share. This represents an increase of $9.3 million, or 18.6%, compared to the nine month period ended September 30, 2015 with non-GAAP net operating income of $49.9 million, or $0.54 per diluted share. The non-GAAP annualized returns on average shareholders' equity and average assets for the nine month period ended September 30, 2016 were 6.82% and 0.88% compared to 6.15% and 0.82% for the same period last year.
Headquartered in Warren, Pennsylvania, Northwest Bancshares, Inc. is the holding company of Northwest Bank. Founded in 1896, Northwest Bank is a full-service financial institution offering a complete line of business and personal banking products, employee benefits and wealth management services, as well as the fulfillment of business and personal insurance needs. Northwest operates 167 full-service community banking offices and nine free standing drive-through facilities in Pennsylvania, New York, Ohio and Maryland and 51 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 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; and (7) increased risk associated with commercial real-estate and business loans. Management has no obligation to revise or update these forward-looking statements to reflect events or circumstances that arise after the date of this release.
Northwest Bancshares, Inc. and Subsidiaries
Consolidated Statements of Financial Condition (Unaudited)
(Dollars in thousands, except per share amounts)
September 30, December 31, September 30,
2016 2015 2015
---- ---- ----
Assets
Cash and cash equivalents $107,604 92,263 91,406
Interest-earning deposits in other financial institutions 210,723 74,510 3,206
Federal funds sold and other short-term investments 2,239 635 1,013
Marketable securities available-for-sale (amortized cost of $879,141, $868,956 and $965,965, respectively) 890,688 874,405 976,677
Marketable securities held-to-maturity (fair value of $23,249, $32,552 and $48,511, respectively) 22,584 31,689 47,299
------ ------ ------
Total cash, interest-earning deposits and marketable securities 1,233,838 1,073,502 1,119,601
Residential mortgage loans held for sale 30,355 - -
Residential mortgage loans 2,788,658 2,740,892 2,712,537
Home equity loans 1,349,105 1,187,106 1,203,190
Consumer loans 628,512 520,289 494,714
Commercial real estate loans 2,464,681 2,351,434 2,330,864
Commercial loans 537,255 422,400 410,308
------- ------- -------
Total loans receivable 7,798,566 7,222,121 7,151,613
Allowance for loan losses (63,246) (62,672) (60,547)
------- ------- -------
Loans receivable, net 7,735,320 7,159,449 7,091,066
Federal Home Loan Bank stock, at cost 7,660 40,903 40,115
Accrued interest receivable 21,591 21,072 22,098
Real estate owned, net 4,841 8,725 10,391
Premises and Equipment, net 167,596 154,351 153,841
Bank owned life insurance 170,172 168,509 167,258
Goodwill 307,711 261,736 261,319
Other intangible assets 33,901 8,982 9,712
Other assets 31,977 54,670 59,507
------ ------ ------
Total assets $9,714,607 8,951,899 8,934,908
========== ========= =========
Liabilities and Shareholders' equity
Liabilities
Noninterest-bearing demand deposits $1,496,574 1,177,256 1,127,864
Interest-bearing demand deposits 1,446,971 1,080,086 1,097,969
Money market deposit accounts 1,896,272 1,274,504 1,277,878
Savings deposits 1,671,539 1,386,017 1,378,958
Time deposits 1,691,447 1,694,718 1,762,073
--------- --------- ---------
Total deposits 8,202,803 6,612,581 6,644,742
Borrowed funds 135,891 975,007 927,219
Advances by borrowers for taxes and insurance 21,616 33,735 18,216
Accrued interest payable 682 1,993 1,816
Other liabilities 79,599 54,207 62,246
Junior subordinated debentures 111,213 111,213 119,332
------- ------- -------
Total liabilities 8,551,804 7,788,736 7,773,571
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, 101,268,648 shares, 101,871,737 shares and 101,725,112
issued and outstanding, respectively 1,013 1,019 1,017
Paid-in-capital 711,974 717,603 714,730
Retained earnings 469,459 489,292 487,048
Unallocated common stock of Employee Stock Ownership Plan - (20,216) (21,398)
Accumulated other comprehensive loss (19,643) (24,535) (20,060)
------- ------- -------
Total shareholders' equity 1,162,803 1,163,163 1,161,337
--------- --------- ---------
Total liabilities and shareholders' equity $9,714,607 8,951,899 8,934,908
========== ========= =========
Equity to assets 11.97% 12.99% 13.00%
Tangible common equity to assets 8.76% 10.28% 10.31%
Book value per share $11.48 11.42 11.42
Tangible book value per share $8.11 8.76 8.78
Closing market price per share $15.71 13.39 13.00
Full time equivalent employees 2,268 2,186 2,209
Number of banking offices 176 181 182
Northwest Bancshares, Inc. and Subsidiaries
Consolidated Statements of Income (Unaudited)
(Dollars in thousands, except per share amounts)
Quarter ended
-------------
September 30, June 30, March 31, December 31, September 30,
2016 2016 2016 2015 2015
---- ---- ---- ---- ----
Interest income:
Loans receivable $82,435 82,645 80,781 80,882 76,087
Mortgage-backed securities 2,030 2,115 2,229 2,301 2,230
Taxable investment securities 627 756 1,038 1,108 1,238
Tax-free investment securities 676 707 724 836 986
FHLB dividends 218 401 467 499 451
Interest-earning deposits 114 70 59 13 99
--- --- --- --- ---
Total interest income 86,100 86,694 85,298 85,639 81,091
Interest expense:
Deposits 5,653 5,865 6,088 6,435 6,163
Borrowed funds 1,801 4,143 7,658 8,051 7,987
----- ----- ----- ----- -----
Total interest expense 7,454 10,008 13,746 14,486 14,150
Net interest income 78,646 76,686 71,552 71,153 66,941
Provision for loan losses 5,538 4,199 1,660 4,595 3,167
----- ----- ----- ----- -----
Net interest income after provision for loan losses 73,108 72,487 69,892 66,558 63,774
Noninterest income:
Gain on sale of investments 58 227 127 116 260
Service charges and fees 11,012 10,630 10,065 10,530 9,945
Trust and other financial services income 3,434 3,277 3,261 3,410 3,062
Insurance commission income 2,541 2,768 2,714 2,490 2,398
Gain/ (loss) on real estate owned, net (563) 111 249 (156) (246)
Income from bank owned life insurance 1,380 1,105 1,595 1,251 1,166
Mortgage banking income 1,886 446 218 208 267
Other operating income 1,070 1,711 1,219 1,697 1,288
----- ----- ----- ----- -----
Total noninterest income 20,818 20,275 19,448 19,546 18,140
Noninterest expense:
Compensation and employee benefits 39,474 34,349 33,033 32,003 31,000
Premises and occupancy costs 6,094 6,275 6,537 6,403 6,072
Office operations 3,700 3,343 3,460 3,252 3,268
Collections expense 589 729 676 1,252 624
Processing expenses 8,844 8,172 8,414 8,057 8,126
Marketing expenses 2,239 2,541 1,891 1,642 1,691
Federal deposit insurance premiums 984 1,442 1,503 1,299 1,177
Professional services 1,815 2,129 1,833 1,933 1,529
Amortization of intangible assets 1,068 710 675 729 422
Real estate owned expense 206 295 311 393 471
Restructuring/ acquisition expense 7,183 3,386 635 1,347 7,590
FHLB prepayment penalty - 36,978 - - -
Other expense 2,836 2,912 4,307 2,917 1,834
----- ----- ----- ----- -----
Total noninterest expense 75,032 103,261 63,275 61,227 63,804
------ ------- ------ ------ ------
Income/(loss) before income taxes 18,894 (10,499) 26,065 24,877 18,110
Income tax expense/ (benefit) 4,697 (3,491) 8,081 8,684 5,238
----- ------ ----- ----- -----
Net income/ (loss) $14,197 (7,008) 17,984 16,193 12,872
======= ====== ====== ====== ======
Basic earnings/ (loss) per share $0.14 (0.07) 0.18 0.16 0.14
Diluted earnings/ (loss) per share $0.14 (0.07) 0.18 0.16 0.13
Weighted average common shares outstanding - basic 99,587,630 99,177,609 98,889,744 98,741,393 95,256,807
Weighted average common shares outstanding - diluted 101,053,340 100,243,442 99,380,009 99,500,056 95,825,798
Annualized return on average equity 4.89% (2.44)% 6.21% 5.55% 4.54%
Annualized return on average assets 0.63% (0.32)% 0.81% 0.73% 0.59%
Annualized return on tangible common equity 6.88% (3.18)% 8.03% 7.20% 5.72%
Efficiency ratio * 67.14% 64.14% 68.09% 65.22% 65.58%
Annualized noninterest expense to average assets * 2.94% 2.82% 2.80% 2.63% 2.57%
* Excludes restructuring/acquisition expenses, FHLB
prepayment penalty, and amortization of intangible
assets (non-GAAP).
Northwest Bancshares, Inc. and Subsidiaries
Consolidated Statements of Income (Unaudited)
(Dollars in thousands, except per share amounts)
Nine months ended September 30,
-------------------------------
2016 2015
---- ----
Interest income:
Loans
receivable $245,861 217,783
Mortgage-
backed
securities 6,374 6,522
Taxable
investment
securities 2,421 3,412
Tax-free
investment
securities 2,107 3,477
FHLB
dividends 1,086 2,329
Interest-
earning
deposits 243 418
--- ---
Total
interest
income 258,092 233,941
Interest expense:
Deposits 17,606 17,620
Borrowed
funds 13,602 24,221
------ ------
Total
interest
expense 31,208 41,841
Net
interest
income 226,884 192,100
Provision
for loan
losses 11,397 5,117
------ -----
Net
interest
income
after
provision
for loan
losses 215,487 186,983
Noninterest income:
Gain on
sale of
investments 412 921
Service
charges
and fees 31,707 27,832
Trust and
other
financial
services
income 9,972 8,932
Insurance
commission
income 8,023 7,036
Loss on
real
estate
owned, net (203) (1,833)
Income from
bank owned
life
insurance 4,080 3,087
Mortgage
banking
income 2,550 725
Other
operating
income 4,000 2,590
----- -----
Total
noninterest
income 60,541 49,290
Noninterest expense:
Compensation
and
employee
benefits 106,856 87,815
Premises
and
occupancy
costs 18,906 18,238
Office
operations 10,503 9,085
Collections
expense 1,994 1,995
Processing
expenses 25,430 22,723
Marketing
expenses 6,671 6,857
Federal
deposit
insurance
premiums 3,929 3,810
Professional
services 5,777 4,973
Amortization
of
intangible
assets 2,453 959
Real estate
owned
expense 812 1,677
Restructuring/
acquisition
expense 11,204 8,404
FHLB
prepayment
penalty 36,978 -
Other
expense 10,055 6,114
------ -----
Total
noninterest
expense 241,568 172,650
------- -------
Income
before
income
taxes 34,460 63,623
Income tax
expense 9,287 19,276
----- ------
Net income $25,173 44,347
======= ======
Basic
earnings
per share $0.25 0.48
Diluted
earnings
per share $0.25 0.48
Weighted
average
common
shares
outstanding
-basic 99,219,560 92,822,720
Weighted
average
common
shares
outstanding
-diluted 100,228,503 93,256,099
Annualized
return on
average
equity 2.90% 5.47%
Annualized
return on
average
assets 0.38% 0.73%
Annualized
return on
tangible
common
equity 4.09% 6.64%
Efficiency
ratio * 66.43% 67.64%
Annualized
noninterest
expense to
average
assets * 2.85% 2.69%
* Excludes restructuring/acquisition expenses, FHLB
prepayment penalty, and amortization of intangible
assets (non-GAAP).
Northwest Bancshares, Inc. and Subsidiaries
Reconciliation of Non-GAAP to GAAP Net Income (Unaudited) *
(Dollars in thousands, except per share amounts)
Quarter ended Nine months ended
September 30, September 30,
------------- -------------
2016 2015 2016 2015
---- ---- ---- ----
Operating results (non-GAAP):
Net interest income $78,646 66,941 226,884 192,100
Provision for loan losses 5,538 3,167 11,397 5,117
Noninterest income 20,818 18,140 60,541 49,290
Noninterest expense 62,712 56,214 188,249 164,246
Income taxes 8,710 7,844 28,598 22,128
----- ----- ------ ------
Net operating income (non-GAAP) $22,504 17,856 59,181 49,899
======= ====== ====== ======
Diluted earnings per share (non-GAAP) $0.22 0.19 0.59 0.54
===== ==== ==== ====
Average equity $1,156,137 1,125,305 1,158,346 1,084,126
Average assets 9,028,886 8,614,119 8,940,648 8,125,431
Annualized ROE (non-GAAP) 7.74% 6.30% 6.82% 6.15%
Annualized ROA (non-GAAP) 0.99% 0.82% 0.88% 0.82%
Reconciliation of net operating income to net income:
Net operating income (non-GAAP) $22,504 17,856 59,181 49,899
Nonoperating expenses, net of tax:
Restructuring/ acquisition expenses (4,638) (4,984) (6,098) (5,522)
Stock-based compensation expense - ESOP (3,669) - (3,669) -
FHLB prepayment penalty - - (24,241) -
--- --- ------- ---
Net income/ (loss) (GAAP) $14,197 12,872 25,173 44,377
======= ====== ====== ======
Diluted earnings per share (GAAP) $0.14 0.13 0.25 0.48
===== ==== ==== ====
Annualized ROE (GAAP) 4.89% 4.54% 2.90% 5.47%
Annualized ROA (GAAP) 0.63% 0.59% 0.38% 0.73%
* The table summarizes the Company's
results from operations on a GAAP
basis and on an operating (non-
GAAP) basis for the periods
indicated. Operating results
exclude acquisition expenses and
prepayment penalties, net of tax
benefit. The Company believes
this non-GAAP presentation
provides a meaningful comparison
of operational performance and
facilitates a more effective
evaluation and comparison of
results to assess performance in
relation to ongoing operations.
Northwest Bancshares, Inc. and Subsidiaries
Asset quality (Unaudited)
(Dollars in thousands)
September 30, June 30, March 31, December 31, September 30,
2016 2016 2016 2015 2015
---- ---- ---- ---- ----
Nonaccrual loans current:
Residential mortgage loans $3,063 2,017 1,678 1,393 1,900
Home equity loans 1,446 1,092 1,118 1,108 1,471
Consumer loans 464 277 190 140 251
Commercial real estate loans 19,246 17,456 19,350 14,018 19,602
Commercial loans 7,299 4,462 5,923 4,604 4,877
----- ----- ----- -----
Total nonaccrual loans current $31,518 25,304 28,259 21,263 28,101
======= ====== ====== ====== ======
Nonaccrual loans delinquent 30 days to 59 days:
Residential mortgage loans $344 - 1,600 430 -
Home equity loans 315 49 119 375 392
Consumer loans 211 95 164 97 155
Commercial real estate loans 514 151 3,371 2,192 359
Commercial loans 185 16 4 322 131
--- --- --- ---
Total nonaccrual loans delinquent 30 days to 59 days $1,569 311 5,258 3,416 1,037
====== === ===== ===== =====
Nonaccrual loans delinquent 60 days to 89 days:
Residential mortgage loans $1,270 1,524 721 2,139 1,097
Home equity loans 465 366 504 389 260
Consumer loans 250 157 182 315 156
Commercial real estate loans 151 6,513 109 762 416
Commercial loans 319 1,748 57 110 11
--- ----- --- ---
Total nonaccrual loans delinquent 60 days to 89 days $2,455 10,308 1,573 3,715 1,940
====== ====== ===== ===== =====
Nonaccrual loans delinquent 90 days or more:
Residential mortgage loans $13,242 14,829 14,301 15,810 16,510
Home equity loans 5,874 5,226 5,922 5,650 4,546
Consumer loans 3,354 2,374 2,360 2,900 3,132
Commercial real estate loans 22,155 12,960 13,165 16,449 10,565
Commercial loans 6,105 4,566 3,314 2,459 2,074
----- ----- ----- -----
Total nonaccrual loans delinquent 90 days or more $50,730 39,955 39,062 43,268 36,827
======= ====== ====== ====== ======
Total nonaccrual loans $86,272 75,878 74,152 71,662 67,905
======= ====== ====== ====== ======
Total nonaccrual loans $86,272 75,878 74,152 71,662 67,905
Loans 90 days past maturity and still accruing 103 472 894 1,334 680
--- --- --- ----- ---
Nonperforming loans 86,375 76,350 75,046 72,996 68,585
Real estate owned, net 4,841 4,950 6,834 8,725 10,391
----- ----- ----- -----
Nonperforming assets $91,216 81,300 81,880 81,721 78,976
======= ====== ====== ====== ======
Nonaccrual troubled debt restructuring * $17,374 18,098 17,699 21,118 23,184
Accruing troubled debt restructuring 29,221 31,015 30,549 29,997 26,154
------ ------ ------ ------
Total troubled debt restructuring $46,595 49,113 48,248 51,115 49,338
======= ====== ====== ====== ======
Nonperforming loans to total loans 1.11% 1.05% 1.03% 1.01% 0.96%
Nonperforming assets to total assets 0.94% 0.91% 0.92% 0.91% 0.88%
Allowance for loan losses to total loans 0.81% 0.83% 0.85% 0.87% 0.85%
Allowance for loan losses to nonperforming loans 73.22% 79.61% 82.99% 85.86% 94.54%
* Amounts included in nonperforming
loans above.
Northwest Bancshares, Inc. and Subsidiaries
Exposure to the oil and gas industry (Unaudited)
(Dollars in thousands)
September 30, June 30, March 31, December 31, September 30,
2016 2016 2016 2015 2015
---- ---- ---- ---- ----
Direct exposure to oil and gas extraction:
Outstanding balance $13,109 12,844 13,764 16,619 17,209
Commitments 16,511 16,542 18,450 19,576 20,127
Impaired 558 561 564 564 564
Reserve 511 548 594 626 749
Indirect exposure: *
Outstanding balance 44,781 58,399 54,465 56,659 57,805
Commitments 48,927 62,581 58,522 68,659 79,226
Impaired 761 611 - - -
Reserve 237 220 195 34 150
Total exposure:
Outstanding balance 57,890 71,243 68,229 73,278 75,014
Commitments 65,438 79,123 76,972 88,235 99,353
Impaired 1,319 1,172 564 564 564
Reserve 748 768 789 660 899
* Includes loans to haulers,
wholesalers, and refineries.
Northwest Bancshares, Inc. and Subsidiaries
Loans by credit quality indicators (Unaudited)
(Dollars in thousands)
At September 30, 2016 Pass Special Substandard Doubtful Loss Loans
**
mention receivable
*
--- ---
Personal Banking:
Residential mortgage loans $2,800,420 - 18,593 - - 2,819,013
Home equity loans 1,338,643 - 10,462 - - 1,349,105
Consumer loans 624,885 - 3,627 - - 628,512
------- --- ----- --- --- -------
Total Personal Banking 4,763,948 - 32,682 - - 4,796,630
Commercial Banking:
Commercial real estate loans 2,265,816 61,763 137,088 14 - 2,464,681
Commercial loans 479,321 14,707 40,326 2,901 - 537,255
------- ------ ------ ----- --- -------
Total Commercial Banking 2,745,137 76,470 177,414 2,915 - 3,001,936
--------- ------ ------- ----- --- ---------
Total loans $7,509,085 76,470 210,096 2,915 - 7,798,566
========== ====== ======= ===== === =========
At June 30, 2016
----------------
Personal Banking:
Residential mortgage loans $2,741,101 - 16,497 - - 2,757,598
Home equity loans 1,153,010 - 9,164 - - 1,162,174
Consumer loans 544,174 - 2,376 - - 546,550
------- --- ----- --- --- -------
Total Personal Banking 4,438,285 - 28,037 - - 4,466,322
Commercial Banking:
Commercial real estate loans 2,170,583 63,351 129,428 14 - 2,363,376
Commercial loans 408,178 15,435 38,546 3,064 - 465,223
------- ------ ------ ----- --- -------
Total Commercial Banking 2,578,761 78,786 167,974 3,078 - 2,828,599
Total loans $7,017,046 78,786 196,011 3,078 - 7,294,921
========== ====== ======= ===== === =========
At March 31, 2016
-----------------
Personal Banking:
Residential mortgage loans $2,755,325 - 13,721 - 1,317 2,770,363
Home equity loans 1,161,382 - 8,439 - - 1,169,821
Consumer loans 523,333 - 2,204 - - 525,537
------- --- ----- --- --- -------
Total Personal Banking 4,440,040 - 24,364 - 1,317 4,465,721
Commercial Banking:
Commercial real estate loans 2,167,110 63,695 130,043 15 - 2,360,863
Commercial loans 409,994 16,425 39,887 1,112 - 467,418
------- ------ ------ ----- --- -------
Total Commercial Banking 2,577,104 80,120 169,930 1,127 - 2,828,281
Total loans $7,017,144 80,120 194,294 1,127 1,317 7,294,002
========== ====== ======= ===== ===== =========
At December 31, 2015
--------------------
Personal Banking:
Residential mortgage loans $2,725,492 - 14,060 - 1,340 2,740,892
Home equity loans 1,178,735 - 8,371 - - 1,187,106
Consumer loans 517,746 - 2,543 - - 520,289
------- --- ----- --- --- -------
Total Personal Banking 4,421,973 - 24,974 - 1,340 4,448,287
Commercial Banking:
Commercial real estate loans 2,170,951 53,390 126,978 115 - 2,351,434
Commercial loans 359,403 23,730 38,157 1,110 - 422,400
------- ------ ------ ----- --- -------
Total Commercial Banking 2,530,354 77,120 165,135 1,225 - 2,773,834
Total loans $6,952,327 77,120 190,109 1,225 1,340 7,222,121
========== ====== ======= ===== ===== =========
At September 30, 2015
---------------------
Personal Banking:
Residential mortgage loans $2,699,670 - 11,512 - 1,355 2,712,537
Home equity loans 1,198,779 - 4,411 - - 1,203,190
Consumer loans 492,023 - 2,691 - - 494,714
------- --- ----- --- --- -------
Total Personal Banking 4,390,472 - 18,614 - 1,355 4,410,441
Commercial Banking:
Commercial real estate loans 2,154,439 33,339 143,086 - - 2,330,864
Commercial loans 353,366 19,364 37,413 165 - 410,308
------- ------ ------ --- --- -------
Total Commercial Banking 2,507,805 52,703 180,499 165 - 2,741,172
Total loans $6,898,277 52,703 199,113 165 1,355 7,151,613
========== ====== ======= === ===== =========
* Includes $19.3 million $7.6
million, $7.7 million, $7.6
million, and $533,000 of
acquired loans at September 30,
2016, June 30, 2016, March 31,
2016, December 31, 2015, and
September 30, 2015,
respectively.
** Includes $29.8 million, $25.5
million, $17.9 million, $18.6
million, and $18.5 million of
acquired loans at September 30,
2016, June 30, 2016 March 31,
2016, December 31, 2015, and
September 30, 2015,
respectively.
Northwest Bancshares, Inc. and Subsidiaries
Loan delinquency (Unaudited)
(Dollars in thousands)
September 30, * June 30, * March 31, * December 31, * September 30, *
2016 2016 2015 2015
2016
----
(Number of loans and dollar amount of loans)
Loans delinquent 30 days to 59 days:
Residential mortgage loans 74 $3,380 0.1% 72 $3,353 0.1% 323 $24,494 0.9% 349 $25,943 0.9% 75 3,644 0.1%
Home equity loans 164 4,984 0.4% 128 4,988 0.4% 132 5,351 0.5% 173 5,806 0.5% 149 5,770 0.5%
Consumer loans 1,269 7,583 1.2% 1,144 6,725 1.2% 895 5,511 1.0% 1,234 7,101 1.4% 1,214 6,324 1.3%
Commercial real estate loans 28 3,855 0.2% 34 4,828 0.2% 51 27,474 1.2% 48 24,877 1.1% 55 7,463 0.3%
Commercial loans 26 1,493 0.3% 15 533 0.1% 26 3,133 0.7% 31 2,868 0.7% 21 1,379 0.3%
--- ----- --- --- --- ----- --- ----- --- -----
Total loans delinquent 30 days to 59 days 1,561 $21,295 0.3% 1,393 $20,427 0.3% 1,427 $65,963 0.9% 1,835 $66,595 0.9% 1,514 24,580 0.3%
===== ======= ===== ======= ===== ======= ===== ======= ===== ======
Loans delinquent 60 days to 89 days:
Residential mortgage loans 76 $6,174 0.2% 74 $5,633 0.2% 21 $1,358 - % 100 $7,790 0.3% 83 5,193 0.2%
Home equity loans 41 1,145 0.1% 42 1,435 0.1% 36 1,256 0.1% 50 2,478 0.2% 52 1,716 0.1%
Consumer loans 532 2,673 0.4% 514 2,247 0.4% 379 1,803 0.3% 521 2,521 0.5% 512 2,593 0.5%
Commercial real estate loans 13 1,102 - % 16 8,765 0.4% 11 1,081 - % 21 8,228 0.3% 28 8,368 0.4%
Commercial loans 9 594 0.1% 23 2,429 0.5% 7 375 0.1% 7 598 0.1% 8 401 0.1%
--- --- --- ----- --- --- --- --- --- ---
Total loans delinquent 60 days to 89 days 671 $11,688 0.1% 669 $20,509 0.3% 454 $5,873 0.1% 699 $21,615 0.3% 683 18,271 0.3%
=== ======= === ======= === ====== === ======= === ======
Loans delinquent 90 days or more: **
Residential mortgage loans 168 $13,478 0.5% 176 $15,046 0.5% 183 $14,673 0.5% 215 $16,350 0.6% 204 17,209 0.6%
Home equity loans 137 6,022 0.4% 124 5,422 0.5% 120 6,200 0.5% 143 6,112 0.5% 136 5,554 0.5%
Consumer loans 757 3,372 0.5% 440 2,399 0.4% 557 2,386 0.5% 523 2,926 0.6% 570 3,156 0.6%
Commercial real estate loans 106 24,533 1.0% 107 15,244 0.6% 106 15,442 0.7% 113 19,031 0.8% 95 14,898 0.6%
Commercial loans 28 6,249 1.2% 32 4,709 1.0% 34 3,456 0.7% 25 2,599 0.6% 23 2,319 0.6%
--- ----- --- ----- --- ----- --- ----- --- -----
Total loans delinquent 90 days or more 1,196 $53,654 0.7% 879 $42,820 0.6% 1,000 $42,157 0.6% 1,019 $47,018 0.7% 1,028 43,136 0.6%
===== ======= === ======= ===== ======= ===== ======= ===== ======
Total loans delinquent 3,428 $86,637 1.1% 2,941 $83,756 1.1% 2,881 $113,993 1.6% 3,553 $135,228 1.9% 3,225 85,987 1.2%
===== ======= ===== ======= ===== ======== ===== ======== ===== ======
* Represents delinquency, in
dollars, divided by the
respective total amount of that
type of loan outstanding.
** Includes purchased credit
impaired loans of $2.9 million,
$2.9 million, $3.1 million,
$3.7 million, and $6.3 million
at September 30, 2016, June 30,
2016, March 31, 2016, December
31, 2015, and September 30,
2015, respectively.
Northwest Bancshares, Inc. and Subsidiaries
Allowance for loan losses (Unaudited)
(Dollars in thousands)
Quarter ended
-------------
September 30, June 30, March 31, December 31, September 30,
2016 2016 2016 2015 2015
---- ---- ---- ---- ----
Beginning balance $60,781 62,278 62,672 60,547 59,057
Provision 5,538 4,199 1,660 4,595 3,167
Charge-offs residential mortgage (354) (1,852) (564) (171) (342)
Charge-offs home equity (288) (946) (984) (1,097) (443)
Charge-offs consumer (2,701) (2,332) (2,403) (2,561) (2,014)
Charge-offs commercial real estate (789) (1,731) (897) (1,216) (558)
Charge-offs commercial (708) (903) (117) (508) (595)
Recoveries 1,767 2,068 2,911 3,083 2,275
----- ----- ----- ----- -----
Ending balance $63,246 60,781 62,278 62,672 60,547
======= ====== ====== ====== ======
Net charge-offs to average loans, annualized 0.17% 0.31% 0.11% 0.14% 0.10%
Nine months ended September 30,
-------------------------------
2016 2015
---- ----
Beginning balance $62,672 67,518
Provision 11,397 5,117
Charge-offs
residential
mortgage (2,770) (955)
Charge-offs home
equity (2,218) (1,327)
Charge-offs
consumer (7,436) (5,713)
Charge-offs
commercial real
estate (3,417) (5,110)
Charge-offs
commercial (1,728) (7,675)
Recoveries 6,746 8,692
----- -----
Ending balance $63,246 60,547
======= ======
Net charge-offs to
average loans,
annualized 0.20% 0.26%
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
-------------
September 30, 2016 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015
------------------ ------------- -------------- ----------------- ------------------
Average Interest Avg. Average Interest Avg. Average Interest Avg. Average Interest Avg. Average Interest Avg.
Balance Yield/ Balance Yield/ Balance Yield/ Balance Yield/
Balance Yield/ Cost (h) Cost (h) Cost (h) Cost (h)
Cost (h)
---
Assets:
-------
Interest-earning assets:
Residential mortgage loans $2,739,099 29,304 4.28% $2,751,601 30,228 4.39% $2,739,787 29,786 4.35% $2,710,811 29,227 4.31% $2,632,199 29,060 4.42%
Home equity loans 1,192,929 12,884 4.30% 1,163,900 12,701 4.39% 1,177,406 12,642 4.32% 1,193,433 12,753 4.24% 1,114,931 12,208 4.34%
Consumer loans 554,954 8,931 6.40% 522,745 8,697 6.69% 510,091 8,219 6.48% 500,175 8,805 6.98% 364,378 7,146 7.78%
Commercial real estate loans 2,394,001 26,683 4.36% 2,356,994 26,691 4.48% 2,349,748 25,993 4.38% 2,331,769 25,972 4.36% 2,100,463 24,061 4.48%
Commercial loans 476,715 5,193 4.26% 461,808 4,902 4.20% 441,977 4,723 4.23% 412,415 4,671 4.43% 372,693 4,108 4.31%
------- ----- ------- ----- ------- ----- ------- ----- ------- -----
Total loans receivable (a) (b) (d) 7,357,698 82,995 4.49% 7,257,048 83,219 4.61% 7,219,009 81,363 4.53% 7,148,603 81,428 4.52% 6,584,664 76,583 4.66%
Mortgage-backed securities (c) 440,966 2,030 1.84% 458,398 2,115 1.85% 488,294 2,229 1.83% 519,736 2,301 1.77% 498,757 2,230 1.79%
Investment securities (c) (d) 275,718 1,667 2.42% 313,647 1,844 2.35% 387,460 2,151 2.22% 427,363 2,394 2.24% 482,666 2,754 2.28%
FHLB stock 27,761 218 3.12% 33,302 401 4.84% 37,098 467 5.06% 38,651 499 5.12% 39,552 451 4.52%
Other interest-earning deposits 91,243 114 0.49% 63,950 70 0.43% 43,578 59 0.54% 40,410 13 0.13% 162,041 99 0.24%
------ --- ------ --- ------ --- ------ --- ------- ---
Total interest-earning assets 8,193,386 87,024 4.23% 8,126,345 87,649 4.34% 8,175,439 86,269 4.24% 8,174,763 86,635 4.20% 7,767,680 82,117 4.24%
Noninterest earning assets (e) 835,500 755,713 735,562 747,317 846,439
------- ------- ------- ------- -------
Total assets $9,028,886 $8,882,058 $8,911,001 $8,922,080 $8,614,119
========== ========== ========== ========== ==========
Liabilities and shareholders' equity:
-------------------------------------
Interest-bearing liabilities:
Savings deposits $1,485,763 744 0.20% $1,440,886 837 0.23% $1,405,800 865 0.25% $1,378,377 871 0.25% $1,324,620 865 0.26%
Interest-bearing demand deposits 1,179,557 78 0.03% 1,130,122 144 0.05% 1,093,839 156 0.06% 1,083,524 157 0.06% 1,022,585 149 0.06%
Money market deposit accounts 1,418,779 826 0.23% 1,294,381 829 0.26% 1,288,535 865 0.27% 1,279,181 873 0.27% 1,217,122 825 0.27%
Time deposits 1,597,542 4,005 1.00% 1,616,260 4,055 1.01% 1,664,322 4,202 1.02% 1,720,895 4,534 1.05% 1,577,159 4,324 1.09%
Borrowed funds (f) 560,407 657 0.47% 772,225 3,017 1.57% 899,439 6,539 2.92% 906,574 6,730 2.95% 906,410 6,713 2.94%
Junior subordinated debentures 111,213 1,144 4.03% 111,213 1,126 4.01% 111,213 1,119 3.98% 116,626 1,321 4.43% 111,213 1,274 4.48%
------- ----- ------- ----- ------- ----- ------- ----- ------- -----
Total interest-bearing liabilities 6,353,261 7,454 0.47% 6,365,087 10,008 0.63% 6,463,148 13,746 0.86% 6,485,177 14,486 0.89% 6,159,109 14,150 0.91%
Noninterest-bearing demand deposits (g) 1,243,474 1,184,786 1,161,151 1,145,276 1,054,270
Noninterest bearing liabilities 276,014 177,300 122,667 133,323 275,435
------- ------- ------- ------- -------
Total liabilities 7,872,749 7,727,173 7,746,966 7,763,776 7,488,814
Shareholders' equity 1,156,137 1,154,885 1,164,035 1,158,304 1,125,305
--------- --------- --------- --------- ---------
Total liabilities and shareholders' equity $9,028,886 $8,882,058 $8,911,001 $8,922,080 $8,614,119
========== ========== ========== ========== ==========
Net interest income/ Interest rate spread 79,570 3.76% 77,641 3.71% 72,523 3.38% 72,149 3.31% 67,967 3.33%
Net interest-earning assets/ Net interest margin $1,840,125 3.88% $1,761,258 3.82% $1,712,291 3.57% $1,689,586 3.53% $1,608,571 3.50%
Ratio of interest-earning assets to interest-bearing liabilities 1.29X 1.28X 1.26X 1.26X 1.26X
(a) Average gross loans receivable includes loans held as
available-for-sale and loans placed on nonaccrual
status.
(b) Interest income includes accretion/ amortization of
deferred loan fees/ expenses, which was not material.
(c) Average balances do not include the effect of
unrealized gains or losses on securities held as
available-for-sale.
(d) Interest income on tax-free investment securities and
tax-free loans are presented on a fully taxable
equivalent basis.
(e) Average balances include the effect of unrealized gains
or losses on securities held as available-for-sale.
(f) Average balances include FHLB borrowings and
collateralized borrowings.
(g) Average cost of deposits were 0.32%, 0.35%, 0.37%,
0.39% and 0.39%, respectively.
(h) Shown on a FTE basis. GAAP basis yields for the periods
indicated were: Loans - 4.46%, 4.58%, 4.50%, 4.49%
and 4.63%, respectively, Investment securities -
1.89%, 1.87%, 1.82%, 1.82% and 1.84%, respectively,
Interest-earning assets - 4.18%, 4.29%, 4.20%, 4.16%
and 4.19%, respectively. GAAP basis net interest rate
spreads were 3.71%, 3.66%, 3.34%, 3.27% and 3.28%,
respectively, and GAAP basis net interest margins were
3.84%, 3.77%, 3.55%, 3.48% and 3.45%, respectively.
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.
Nine months ended September 30,
-------------------------------
2016 2015
---- ----
Average Interest Avg. Average Interest Avg.
Balance Yield/ Balance Yield/
Cost (h) Cost (h)
--------
Assets:
-------
Interest-earning assets:
Residential mortgage loans $2,743,480 89,317 4.34% $2,564,143 85,710 4.46%
Home equity loans 1,178,133 38,229 4.33% 1,076,385 35,083 4.36%
Consumer loans 529,356 25,848 6.52% 283,835 19,965 9.40%
Commercial real estate loans 2,367,014 79,367 4.41% 1,921,007 66,245 4.55%
Commercial loans 460,228 14,817 4.23% 382,679 12,207 4.21%
------- ------ ------- ------
Loans receivable (a) (b) (d) 7,278,211 247,578 4.54% 6,228,049 219,210 4.71%
Mortgage-backed securities (c) 462,474 6,374 1.84% 494,416 6,522 1.76%
Investment securities (c) (d) 325,427 5,662 2.32% 483,792 8,761 2.41%
FHLB stock (i) 32,702 1,086 4.44% 37,112 2,329 4.64%
Other interest-earning deposits 57,996 243 0.55% 217,232 418 0.25%
------ --- ------- ---
Total interest-earning assets 8,156,810 260,943 4.27% 7,460,601 237,240 4.23%
Noninterest earning assets (e) 783,838 664,830
------- -------
Total assets $8,940,648 $8,125,431
========== ==========
Liabilities and shareholders' equity:
-------------------------------------
Interest-bearing liabilities:
Savings deposits $1,444,302 2,446 0.23% $1,273,724 2,516 0.26%
Interest-bearing demand deposits 1,134,669 378 0.04% 1,025,896 411 0.06%
Money market deposit accounts 1,334,158 2,520 0.25% 1,176,446 2,349 0.27%
Time deposits 1,625,936 12,262 1.01% 1,395,165 12,344 1.11%
Borrowed funds (f) 743,353 10,213 1.84% 932,123 20,617 2.96%
Junior subordinated debentures 111,213 3,389 4.00% 105,800 3,604 4.49%
------- ----- ------- -----
Total interest-bearing liabilities 6,393,631 31,208 0.65% 5,909,154 41,841 0.95%
Noninterest-bearing demand deposits (g) 1,196,737 975,904
Noninterest bearing liabilities 191,934 156,247
------- -------
Total liabilities 7,782,302 7,041,305
Shareholders' equity 1,158,346 1,084,126
--------- ---------
Total liabilities and shareholders' equity $8,940,648 $8,125,431
========== ==========
Net interest income/ Interest rate spread 229,735 3.62% 195,399 3.28%
Net interest-earning assets/ Net interest margin $1,763,179 3.76% $1,551,447 3.47%
Ratio of interest-earning assets to interest-bearing liabilities 1.28X 1.26X
(a) Average gross loans receivable includes loans held as
available-for-sale and loans placed on nonaccrual
status.
(b) Interest income includes accretion/ amortization of
deferred loan fees/ expenses, which was not material.
(c) Average balances do not include the effect of
unrealized gains or losses on securities held as
available-for-sale.
(d) Interest income on tax-free investment securities and
tax-free loans are presented on a fully taxable
equivalent basis.
(e) Average balances include the effect of unrealized gains
or losses on securities held as available-for-sale.
(f) Average balances include FHLB borrowings and
collateralized borrowings.
(g) Average cost of deposits were 0.35%, and 0.40%,
respectively.
(h) Shown on a FTE basis. GAAP basis yields for the periods
indicated were: Loans - 4.51% and 4.68%,
respectively, Investment securities - 1.86% and
1.90%, respectively, Interest-earning assets - 4.23%
and 4.17%, respectively. GAAP basis net interest rate
spreads were 3.57% and 3.22%, respectively, and GAAP
basis net interest margins were 3.71% and 3.41%,
respectively.
(i) The average yield calculation excludes the $1.0 million
special dividend paid in February 2015, the average
yield was 8.39% with the special dividend included.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/northwest-bancshares-inc-announces-third-quarter-2016-earnings-and-quarterly-dividend-300349768.html
SOURCE Northwest Bancshares, Inc.
