January 23, 2017 - 11:29 AM EST
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Northwest Bancshares, Inc. Announces Record Fourth Quarter 2016 Earnings and Quarterly Dividend Increase

WARREN, Pa., Jan. 23, 2017 /PRNewswire/ -- Northwest Bancshares, Inc. (NasdaqGS: NWBI) announced net income for the quarter ended December 31, 2016 of $24.5 million, or $0.24 per diluted share. This represents an increase of $8.3 million, or 51.3%, compared to the same quarter last year when net income was $16.2 million or $0.16 per diluted share. The annualized returns on average shareholders' equity and average assets for the quarter ended December 31, 2016 were 8.37% and 1.01% compared to 5.55% and 0.73% for the same quarter last year.

The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.16 per share payable on February 16, 2017, to shareholders of record as of February 2, 2017. This represents a 6.67% increase over the prior year and is the 89th consecutive quarter in which the Company has paid a cash dividend.

In making this announcement, William J. Wagner, President and CEO, noted, "The results of the fourth quarter when compared to the previous year reflect the earnings accretion we expected from both the LNB merger and the First Niagara branch acquisition. As a result of these acquisitions our checking accounts have increased by 37% over the last two years and time deposits have decreased to less than 20% of total deposits. This change in deposit mix has increased our net interest margin from 3.53% to 3.75%. These acquisitions along with the recently announced plan to divest our three offices in Maryland better defines our footprint for the future and establishes a framework for increased revenue growth and greater efficiency."

Net interest income increased by $11.7 million, or 16.6%, to $82.9 million for the quarter ended December 31, 2016, from $71.2 million for the quarter ended December 31, 2015. This increase is due primarily to a $4.8 million, or 5.9%, increase in interest income on loans and a $6.8 million, or 84.7% decrease in interest expense on borrowed funds. The increase in loan interest income is a result of a $580.1 million increase in the average balance of the Company's loan portfolio from the same quarter last year, while the decrease in interest expense on borrowed funds is due primarily to the payoff of Federal Home Loan Bank ("FHLB") advances with the funds received from the purchase of deposits in western New York.

The provision for loan losses decreased by $2.5 million, or 53.3%, to $2.1 million for the quarter ended December 31, 2016, from $4.6 million for the quarter ended December 31, 2015. This decrease is due primarily to a decrease in the percentage of total loan delinquency to total loans to 1.61% at December 31, 2016 from 1.87% at December 31, 2015.

Noninterest income increased by $5.3 million, or 27.0%, to $24.8 million for the quarter ended December 31, 2016, from $19.5 million for the quarter ended December 31, 2015. Contributing to this increase was an increase in mortgage banking income of $2.1 million, which is the result of resuming the sale of mortgage loans originated by the Wholesale Lending Division.  Also contributing to this increase was an increase in service charges and fees of $1.9 million, or 17.8%, which is primarily attributable to the growth in checking accounts from both acquisitions, and internal growth initiatives. Additionally, trust and other financial services income increased by $721,000, or 21.1%, due primarily to the approximately $450.0 million of wealth management assets acquired with the western New York branch purchase.

Noninterest expense increased by $7.6 million, or 12.3%, to $68.8 million for the quarter ended December 31, 2016, from $61.2 million for the quarter ended December 31, 2015. This increase resulted primarily from a $4.6 million, or 14.3%, increase in compensation and employee benefits due primarily to the costs associated with the employees added from the 18 western New York branches. The other increases for the current quarter compared to the prior year are also primarily attributable to incremental expenses from the additional branches. Partially offsetting these increases were decreases in federal deposit insurance premiums and collection expense of $824,000 and $815,000, respectively.

Net income for the year ended December 31, 2016 was $49.7 million, or $0.49 per diluted share, which represents a decrease of $10.8 million, or 18.0%, compared to the year ended December 31, 2015, when net income was $60.5 million, or $0.64 per diluted share. The annualized returns on average shareholders' equity and average assets for the year ended December 31, 2016 were 4.28% and 0.55%, respectively, compared to 5.49% 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 $12.2 million, and ESOP termination expense of $5.1 million.

Non-GAAP net operating income for the year ended December 31, 2016, which excludes the after-tax impact of the aforementioned FHLB prepayment penalty, restructuring and acquisition expenses, and ESOP termination expenses totaling $34.7 million, was $84.3 million, or $0.84 per diluted share. This represents an increase of $17.3 million, or 25.8%, compared to the year ended December 31, 2015 with non-GAAP net operating income of $67.0 million, or $0.71 per diluted share. The non-GAAP annualized returns on average shareholders' equity and average assets for the year ended December 31, 2016 were 7.27% and 0.93%, respectively, compared to 6.08% and 0.80% for the same period last year.

The Company previously announced that it has entered into a purchase and assumption agreement to sell three bank branches located in the greater Baltimore, Maryland area to Shore Bancshares, Inc.'s banking subsidiary, Shore United Bank. This divestiture includes approximately $216.0 million of deposits, $147.0 million of performing loans and $40.0 million of cash. The transaction includes a deposit premium of 8.0% and based on the amounts at the time the agreement was signed Northwest anticipates recording a gain of approximately $17.0 million. The sale is expected to close during the second quarter of 2017.

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 49 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)








December 31,
 2016


September 30,
 2016


December 31,
 2015

Assets






Cash and cash equivalents

$

119,403



107,604



92,263


Interest-earning deposits in other financial institutions

266,902



210,723



74,510


Federal funds sold and other short-term investments

3,562



2,239



635


Marketable securities available-for-sale (amortized cost of $825,552, $879,141 and $868,956, respectively)

826,200



890,688



874,405


Marketable securities held-to-maturity (fair value of $20,426, $23,249 and $32,552 , respectively)

19,978



22,584



31,689


Total cash, interest-earning deposits and marketable securities

1,236,045



1,233,838



1,073,502








Residential mortgage loans held-for-sale

9,625



30,355




Residential mortgage loans

2,705,139



2,788,658



2,740,892


Home equity loans

1,328,772



1,349,105



1,187,106


Consumer loans

642,961



628,512



520,289


Commercial real estate loans

2,342,089



2,464,681



2,351,434


Commercial loans

528,761



537,255



422,400


Total loans receivable

7,557,347



7,798,566



7,222,121


Allowance for loan losses

(60,939)



(63,246)



(62,672)


Loans receivable, net

7,496,408



7,735,320



7,159,449








Assets held-for-sale

152,528






Federal Home Loan Bank stock, at cost

7,390



7,660



40,903


Accrued interest receivable

21,699



21,591



21,072


Real estate owned, net

4,889



4,841



8,725


Premises and equipment, net

161,185



167,596



154,351


Bank owned life insurance

171,449



170,172



168,509


Goodwill

307,420



307,711



261,736


Other intangible assets

32,433



33,901



8,982


Other assets

32,194



31,977



54,670


Total assets

$

9,623,640



9,714,607



8,951,899








Liabilities and Shareholders' equity






Liabilities






Noninterest-bearing demand deposits

$

1,448,972



1,496,574



1,177,256


Interest-bearing demand deposits

1,428,317



1,446,971



1,080,086


Money market deposit accounts

1,841,567



1,896,272



1,274,504


Savings deposits

1,622,879



1,671,539



1,386,017


Time deposits

1,540,586



1,691,447



1,694,718


Total deposits

7,882,321



8,202,803



6,612,581








Liabilities held-for-sale

215,657






Borrowed funds

142,899



135,891



975,007


Advances by borrowers for taxes and insurance

36,879



21,616



33,735


Accrued interest payable

635



682



1,993


Other liabilities

63,373



79,599



54,207


Junior subordinated debentures

111,213



111,213



111,213


Total liabilities

8,452,977



8,551,804



7,788,736








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, 101,699,406 shares, 101,268,648 shares and 101,871,737 issued and outstanding, respectively

1,017



1,013



1,019


Paid-in-capital

718,834



711,974



717,603


Retained earnings

478,803



469,459



489,292


Unallocated common stock of Employee Stock Ownership Plan





(20,216)


Accumulated other comprehensive loss

(27,991)



(19,643)



(24,535)


Total shareholders' equity

1,170,663



1,162,803



1,163,163


Total liabilities and shareholders' equity

$

9,623,640



9,714,607



8,951,899








Equity to assets

12.16

%


11.97

%


12.99

%

Tangible common equity to assets

8.95

%


8.76

%


10.28

%

Book value per share

$

11.51



11.48



11.42


Tangible book value per share

$

8.17



8.11



8.76


Closing market price per share

$

18.03



15.71



13.39


Full time equivalent employees

2,306



2,268



2,186


Number of banking offices

176



176



181


 

 

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Income (Unaudited)

(Dollars in thousands, except per share amounts)




Quarter ended


December 31,


September 30,


June 30,


March 31,


December 31,


2016


2016


2016


2016


2015

Interest income:










Loans receivable

$

85,669



81,083



81,506



80,781



80,882


Mortgage-backed securities

2,166



2,030



2,115



2,229



2,301


Taxable investment securities

988



627



756



1,038



1,108


Tax-free investment securities

625



676



707



724



836


FHLB dividends

285



218



401



467



499


Interest-earning deposits

300



114



70



59



13


Total interest income

90,033



84,748



85,555



85,298



85,639












Interest expense:










Deposits

5,859



5,653



5,865



6,088



6,435


Borrowed funds

1,232



1,801



4,143



7,658



8,051


Total interest expense

7,091



7,454



10,008



13,746



14,486












Net interest income

82,942



77,294



75,547



71,552



71,153


Provision for loan losses

2,145



5,538



4,199



1,660



4,595


Net interest income after provision for loan losses

80,797



71,756



71,348



69,892



66,558












Noninterest income:










Gain on sale of investments

213



58



227



127



116


Service charges and fees

12,406



11,012



10,630



10,065



10,530


Trust and other financial services income

4,131



3,434



3,277



3,261



3,410


Insurance commission income

2,499



2,541



2,768



2,714



2,490


Gain/ (loss) on real estate owned, net

164



(563)



111



249



(156)


Income from bank owned life insurance

1,281



1,380



1,105



1,595



1,251


Mortgage banking income

2,344



1,886



446



218



208


Other operating income

1,781



1,070



1,711



1,219



1,697


Total noninterest income

24,819



20,818



20,275



19,448



19,546












Noninterest expense:










Compensation and employee benefits

36,562



38,122



33,210



33,033



32,003


Premises and occupancy costs

7,228



6,094



6,275



6,537



6,403


Office operations

4,395



3,700



3,343



3,460



3,252


Collections expense

437



589



729



676



1,252


Processing expenses

9,429



8,844



8,172



8,414



8,057


Marketing expenses

2,181



2,239



2,541



1,891



1,642


Federal deposit insurance premiums

475



984



1,442



1,503



1,299


Professional services

2,088



1,815



2,129



1,833



1,933


Amortization of intangible assets

1,806



1,068



710



675



729


Real estate owned expense

192



206



295



311



393


Restructuring/ acquisition expense

1,009



7,183



3,386



635



1,347


FHLB prepayment penalty





36,978






Other expense

2,959



2,836



2,912



4,307



2,917


Total noninterest expense

68,761



73,680



102,122



63,275



61,227


Income/ (loss) before income taxes

36,855



18,894



(10,499)



26,065



24,877












Income tax expense/ (benefit)

12,361



4,697



(3,491)



8,081



8,684


Net income/ (loss)

$

24,494



14,197



(7,008)



17,984



$

16,193












Basic earnings/ (loss) per share

$

0.24



0.14



(0.07)



0.18



0.16


Diluted earnings/ (loss) per share

$

0.24



0.14



(0.07)



0.18



0.16












Weighted average common shares outstanding - basic

100,219,370



99,602,535



99,177,609



98,889,744



98,741,393


Weighted average common shares outstanding - diluted

102,089,892



101,068,245



100,243,442



99,380,009



99,500,056












Annualized return on average equity

8.37

%


4.89

%


(2.44)%



6.21

%


5.55

%

Annualized return on average assets

1.01

%


0.63

%


(0.32)%



0.81

%


0.73

%

Annualized return on tangible common equity

11.73

%


6.88

%


(3.18)%



8.03

%


7.20

%











Efficiency ratio *

61.20

%


66.69

%


63.71

%


68.09

%


65.22

%

Annualized noninterest expense to average assets *

2.73

%


2.88

%


2.76

%


2.80

%


2.63

%


* 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)




Year Ended December 31,


2016


2015

Interest income:




Loans receivable

$

329,039



298,665


Mortgage-backed securities

8,540



8,823


Taxable investment securities

3,409



4,520


Tax-free investment securities

2,732



4,313


FHLB dividends

1,371



2,828


Interest-earning deposits

543



431


Total interest income

345,634



319,580






Interest expense:




Deposits

23,465



24,055


Borrowed funds

14,834



32,272


Total interest expense

38,299



56,327






Net interest income

307,335



263,253


Provision for loan losses

13,542



9,712


Net interest income after provision for loan losses

293,793



253,541






Noninterest income:




Gain on sale of investments

625



1,037


Service charges and fees

44,113



38,362


Trust and other financial services income

14,103



12,342


Insurance commission income

10,522



9,526


Loss on real estate owned, net

(39)



(1,989)


Income from bank owned life insurance

5,361



4,338


Mortgage banking income

4,894



933


Other operating income

5,781



4,287


Total noninterest income

85,360



68,836






Noninterest expense:




Compensation and employee benefits

140,927



119,818


Premises and occupancy costs

26,134



24,641


Office operations

14,898



12,337


Collections expense

2,431



3,247


Processing expenses

34,859



30,780


Marketing expenses

8,852



8,499


Federal deposit insurance premiums

4,404



5,109


Professional services

7,865



6,906


Amortization of intangible assets

4,259



1,688


Real estate owned expense

1,004



2,070


Restructuring/ acquisition expense

12,213



9,751


FHLB prepayment penalty

36,978




Other expense

13,014



9,031


Total noninterest expense

307,838



233,877


Income before income taxes

71,315



88,500






Income tax expense

21,648



27,960


Net income

$

49,667



60,540






Basic earnings per share

$

0.50



0.64


Diluted earnings per share

$

0.49



0.64






Weighted average common shares outstanding - basic

99,439,174



94,314,420


Weighted average common shares outstanding - diluted

100,664,688



94,829,789






Annualized return on average equity

4.28

%


5.49

%

Annualized return on average assets

0.55

%


0.73

%

Annualized return on tangible common equity

5.98

%


6.78

%





Efficiency ratio *

64.78

%


66.98

%

Annualized noninterest expense to average assets *

2.79

%


2.67

%


* 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

December 31,


Year ended

December 31,


2016


2015


2016


2015

Operating results (non-GAAP):








Net interest income

$

82,942



71,153



307,335



263,253


Provision for loan losses

2,145



4,595



13,542



9,712


Noninterest income

24,819



19,546



85,360



68,836


Noninterest expense

67,752



59,880



253,510



224,126


Income taxes

12,724



9,111



41,322



31,239


Net operating income (non-GAAP)

$

25,140



17,113



84,321



67,012


Diluted earnings per share (non-GAAP)

$

0.25



0.17



0.84



0.71










Average equity

$

1,164,127



1,158,304



1,159,791



1,102,671


Average assets

9,624,403



8,922,080



9,111,587



8,324,593


Annualized ROE (non-GAAP)

8.59

%


5.86

%


7.27

%


6.08

%

Annualized ROA (non-GAAP)

1.04

%


0.76

%


0.93

%


0.80

%









Reconciliation of net operating income to net income:








Net operating income (non-GAAP)

$

25,140



17,113



84,321



67,012


Nonoperating expenses, net of tax:








Restructuring/ acquisition expenses

(646)



(920)



(6,744)



(6,472)


Stock-based compensation expense - ESOP





(3,669)




FHLB prepayment penalty





(24,241)




Net income/ (loss) (GAAP)

$

24,494



16,193



49,667



60,540


Diluted earnings per share (GAAP)

$

0.24



0.16



0.49



0.64










Annualized ROE (GAAP)

8.37

%


5.55

%


4.28

%


5.49

%

Annualized ROA (GAAP)

1.01

%


0.73

%


0.55

%


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, prepayment penalties, and compensation expense related to the Northwest Bank ESOP termination, 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.

 

 


Reconciliation of Assets and Liabilities Held-For-Sale (Unaudited)

(Dollars in thousands)




Balance at
December 31,
2016

Assets held-for-sale:


Residential mortgage loans

$

26,406


Home equity loans

15,725


Consumer loans

522


Commercial real estate loans

101,123


Commercial loans

2,884


Total loans

146,660


Accrued interest receivable

416


Premises and equipment, net

5,452


Total assets held-for-sale

$

152,528




Liabilities held-for-sale:


Noninterest-bearing demand deposits

$

34,657


Interest-bearing demand deposits

17,181


Money market deposit accounts

45,806


Savings deposits

55,205


Time deposits

62,800


Total deposits

215,649


Accrued interest payable

8


Total liabilities held-for-sale

$

215,657


 

 

Northwest Bancshares, Inc. and Subsidiaries

Asset quality (Unaudited)

(Dollars in thousands)












December 31,
 2016


September 30,
 2016


June 30,
 2016


March 31,
 2016


December 31,
2015

Nonaccrual loans current:










Residential mortgage loans

$

2,109



3,063



2,017



1,678



1,393


Home equity loans

1,451



1,446



1,092



1,118



1,108


Consumer loans

520



464



277



190



140


Commercial real estate loans

13,955



19,246



17,456



19,350



14,018


Commercial loans

5,361



7,299



4,462



5,923



4,604


Total nonaccrual loans current

$

23,396



31,518



25,304



28,259



21,263












Nonaccrual loans delinquent 30 days to 59 days:










Residential mortgage loans

$

1,464



344





1,600



430


Home equity loans

422



315



49



119



375


Consumer loans

400



211



95



164



97


Commercial real estate loans

3,478



514



151



3,371



2,192


Commercial loans

145



185



16



4



322


Total nonaccrual loans delinquent 30 days to 59 days

$

5,909



1,569



311



5,258



3,416












Nonaccrual loans delinquent 60 days to 89 days:










Residential mortgage loans

$

1,522



1,270



1,524



721



2,139


Home equity loans

440



465



366



504



389


Consumer loans

366



250



157



182



315


Commercial real estate loans

2,027



151



6,513



109



762


Commercial loans

695



319



1,748



57



110


Total nonaccrual loans delinquent 60 days to 89 days

$

5,050



2,455



10,308



1,573



3,715












Nonaccrual loans delinquent 90 days or more:










Residential mortgage loans

$

13,169



13,242



14,829



14,301



15,810


Home equity loans

5,552



5,874



5,226



5,922



5,650


Consumer loans

3,823



3,354



2,374



2,360



2,900


Commercial real estate loans

19,264



22,155



12,960



13,165



16,449


Commercial loans

3,373



6,105



4,566



3,314



2,459


Total nonaccrual loans delinquent 90 days or more

$

45,181



50,730



39,955



39,062



43,268












Total nonaccrual loans

$

79,536



86,272



75,878



74,152



71,662












Total nonaccrual loans

$

79,536



86,272



75,878



74,152



71,662


Loans 90 days past maturity and still accruing

649



103



472



894



1,334


Nonperforming loans

80,185



86,375



76,350



75,046



72,996


Real estate owned, net

4,889



4,841



4,950



6,834



8,725


Nonperforming assets

$

85,074



91,216



81,300



81,880



81,721












Nonaccrual troubled debt restructuring *

$

16,346



17,374



18,098



17,699



21,118


Accruing troubled debt restructuring

26,580



29,221



31,015



30,549



29,997


Total troubled debt restructuring

$

42,926



46,595



49,113



48,248



51,115












Nonperforming loans to total loans

1.06

%


1.11

%


1.05

%


1.03

%


1.01

%

Nonperforming assets to total assets

0.88

%


0.94

%


0.91

%


0.92

%


0.91

%

Allowance for loan losses to total loans

0.81

%


0.81

%


0.83

%


0.85

%


0.87

%

Allowance for loan losses to nonperforming loans

76.00

%


73.22

%


79.61

%


82.99

%


85.86

%






* Amounts included in nonperforming loans above.





 

 


Northwest Bancshares, Inc. and Subsidiaries

Exposure to the oil and gas industry (Unaudited)

(Dollars in thousands)












December 31,
 2016


September 30,
 2016


June 30,
 2016


March 31,
 2016


December 31,
 2015

Direct exposure to oil and gas extraction:










   Outstanding balance

$

12,080



13,109



12,844



13,764



16,619


   Commitments

15,318



16,511



16,542



18,450



19,576


   Impaired



558



561



564



564


   Reserve

500



511



548



594



626












Indirect exposure: *










   Outstanding balance

44,602



44,781



58,399



54,465



56,659


   Commitments

48,025



48,927



62,581



58,522



68,659


   Impaired



761



611






   Reserve

231



237



220



195



34












Total exposure:










   Outstanding balance

56,682



57,890



71,243



68,229



73,278


   Commitments

63,343



65,438



79,123



76,972



88,235


   Impaired



1,319



1,172



564



564


   Reserve

731



748



768



789



660










* Includes loans to haulers, wholesalers, and refineries.








 

 

Northwest Bancshares, Inc. and Subsidiaries

Loans by credit quality indicators (Unaudited)

(Dollars in thousands)














At December 31, 2016


Pass


Special
mention
*


Substandard 
**


Doubtful


Loss


Loans

receivable

Personal Banking:













  Residential mortgage loans


$

2,696,705





18,059







2,714,764


  Home equity loans


1,318,998





9,774







1,328,772


  Consumer loans


639,044





3,917







642,961


 Total Personal Banking


4,654,747





31,750







4,686,497


Commercial Banking:













  Commercial real estate loans


2,153,328



43,724



145,037







2,342,089


  Commercial loans


469,993



17,192



41,576







528,761


 Total Commercial Banking


2,623,321



60,916



186,613







2,870,850


Total loans


$

7,278,068



60,916



218,363







7,557,347















At September 30, 2016













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



* Includes $9.4 million $19.3 million, $7.6 million, $7.7 million, and $7.6 million of acquired loans at December 31, 2016, September 30, 2016, June 30, 2016, March 31, 2016, and December 31, 2015, respectively.

** Includes $39.1 million, $29.8 million, $25.5 million, $17.9 million, and $18.6 million of acquired loans at December 31, 2016, September 30, 2016 June 31, 2016, March 31, 2016, and December 31, 2015, respectively.

 

 

Northwest Bancshares, Inc. and Subsidiaries

Loan delinquency (Unaudited)

(Dollars in thousands)
























December 31,

2016


*


September 30,
2016


*


June 30,
2016


*


March 31,
2016


*


December 31,
2015


*

(Number of loans and dollar amount of loans)































Loans delinquent 30 days to 59 days:































Residential mortgage loans


360



$

27,386



1.0

%


74



$

3,380



0.1

%


72



$

3,353



0.1

%


323



$

24,494



0.9

%


349



$

25,943



0.9

%

Home equity loans


179



6,805



0.5

%


164



4,984



0.4

%


128



4,988



0.4

%


132



5,351



0.5

%


173



5,806



0.5

%

Consumer loans


1,497



9,868



1.5

%


1,269



7,583



1.2

%


1,144



6,725



1.2

%


895



5,511



1.0

%


1,234



7,101



1.4

%

Commercial real estate loans


61



10,377



0.4

%


28



3,855



0.2

%


34



4,828



0.2

%


51



27,474



1.2

%


48



24,877



1.1

%

Commercial loans


20



1,178



0.2

%


26



1,493



0.3

%


15



533



0.1

%


26



3,133



0.7

%


31



2,868



0.7

%

Total loans delinquent 30 days to 59 days


2,117



$

55,614



0.7

%


1,561



$

21,295



0.3

%


1,393



$

20,427



0.3

%


1,427



$

65,963



0.9

%


1,835



$

66,595



0.9

%
































Loans delinquent 60 days to 89 days:































Residential mortgage loans


80



$

6,227



0.2

%


76



$

6,174



0.2

%


74



$

5,633



0.2

%


21



$

1,358



%


100



$

7,790



0.3

%

Home equity loans


62



1,563



0.1

%


41



1,145



0.1

%


42



1,435



0.1

%


36



1,256



0.1

%


50



2,478



0.2

%

Consumer loans


636



3,609



0.6

%


532



2,673



0.4

%


514



2,247



0.4

%


379



1,803



0.3

%


521



2,521



0.5

%

Commercial real estate loans


25



4,495



0.2

%


13



1,102



%


16



8,765



0.4

%


11



1,081



%


21



8,228



0.3

%

Commercial loans


21



2,081



0.4

%


9



594



0.1

%


23



2,429



0.5

%


7



375



0.1

%


7



598



0.1

%

Total loans delinquent 60 days to 89 days


824



$

17,975





671



$

11,688



0.1

%


669



$

20,509



0.3

%


454



$

5,873



0.3

%


699



$

21,615



0.3

%
































Loans delinquent 90 days or more: **































Residential mortgage loans


169



$

13,621



0.5

%


168



$

13,478



0.5

%


176



$

15,046



0.5

%


183



$

14,673



0.5

%


215



$

16,350



0.6

%

Home equity loans


155



5,756



0.4

%


137



6,022



0.4

%


124



5,422



0.5

%


120



6,200



0.5

%


143



6,112



0.5

%

Consumer loans


646



3,838



0.6

%


757



3,372



0.5

%


440



2,399



0.4

%


557



2,386



0.5

%


523



2,926



0.6

%

Commercial real estate loans


101



21,270



0.9

%


106



24,533



1.0

%


107



15,244



0.6

%


106



15,442



0.7

%


113



19,031



0.8

%

Commercial loans


37



3,520



0.7

%


28



6,249



1.2

%


32



4,709



1.0

%


34



3,456



0.7

%


25



2,599



0.6

%

Total loans delinquent 90 days or more


1,108



$

48,005



0.6

%


1,196



$

53,654



0.7

%


879



$

42,820



0.6

%


1,000



$

42,157



0.6

%


1,019



$

47,018



0.7

%
































Total loans delinquent


4,049



$

121,594



1.6

%


3,428



$

86,637



1.1

%


2,941



$

83,756



1.1

%


2,881



$

113,993



1.6

%


3,553



$

135,228



1.9

%


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

** Includes purchased credit impaired loans of $2.8 million, $2.9 million, $2.9 million, $3.1 million, and $3.7 million at December 31, 2016, September 30, 2016, June 30, 2016, March 31, 2016, and December 31, 2015 respectively.

 

 

Northwest Bancshares, Inc. and Subsidiaries

Allowance for loan losses (Unaudited)

(Dollars in thousands)




Quarter ended


December 31,
 2016


September 30,
 2016


June 30,
 2016


March 31,
 2016


December 31,
 2015

Beginning balance

$

63,246



60,781



62,278



62,672



60,547


Provision

2,145



5,538



4,199



1,660



4,595


Charge-offs residential mortgage

(710)



(354)



(1,852)



(564)



(171)


Charge-offs home equity

(321)



(288)



(946)



(984)



(1,097)


Charge-offs consumer

(3,469)



(2,701)



(2,332)



(2,403)



(2,561)


Charge-offs commercial real estate

(323)



(789)



(1,731)



(897)



(1,216)


Charge-offs commercial

(2,489)



(708)



(903)



(117)



(508)


Recoveries

2,860



1,767



2,068



2,911



3,083


Ending balance

$

60,939



63,246



60,781



62,278



62,672












Net charge-offs to average loans, annualized

0.23

%


0.17

%


0.31

%


0.11

%


0.14

%

 

 


Year Ended December 31,


2016


2015

Beginning balance

$

62,672



67,518


Provision

13,542



9,712


Charge-offs residential mortgage

(3,480)



(1,126)


Charge-offs home equity

(2,539)



(2,424)


Charge-offs consumer

(10,905)



(8,274)


Charge-offs commercial real estate

(3,740)



(6,326)


Charge-offs commercial

(4,217)



(8,183)


Recoveries

9,606



11,775


Ending balance

$

60,939



62,672






Net charge-offs to average loans, annualized

0.21

%


0.23

%

 

 

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


December 31, 2016


September 30, 2016


June 30, 2016


March 31, 2016


December 31, 2015


Average

Balance


Interest


Avg.

Yield/

Cost (h)


Average
Balance


Interest


Avg.
Yield/
Cost (h)


Average
Balance


Interest


Avg.
Yield/
Cost (h)


Average
Balance


Interest


Avg.
Yield/
Cost (h)


Average
Balance


Interest


Avg.
Yield/
Cost (h)

Assets:






























Interest-earning assets:






























Residential mortgage loans

$

2,766,693



28,165



4.07

%


$

2,739,099



27,952



4.08

%


$

2,751,601



29,089



4.23

%


$

2,739,787



29,786



4.35

%


$

2,710,811



29,227



4.31

%

Home equity loans

1,346,856



14,442



4.27

%


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

%

Consumer loans

620,294



10,083



6.47

%


554,954



8,931



6.40

%


522,745



8,697



6.69

%


510,091



8,219



6.48

%


500,175



8,805



6.98

%

Commercial real estate loans

2,467,569



27,863



4.42

%


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

%

Commercial loans

527,330



5,682



4.27

%


476,715



5,193



4.26

%


461,808



4,902



4.20

%


441,977



4,723



4.23

%


412,415



4,671



4.43

%

Total loans receivable (a) (b) (d)

7,728,742



86,235



4.44

%


7,357,698



81,643



4.41

%


7,257,048



82,080



4.55

%


7,219,009



81,363



4.53

%


7,148,603



81,428



4.52

%

Mortgage-backed securities (c)

482,707



2,166



1.79

%


440,966



2,030



1.84

%


458,398



2,115



1.85

%


488,294



2,229



1.83

%


519,736



2,301



1.77

%

Investment securities (c) (d)

401,602



1,950



1.94

%


275,718



1,667



2.42

%


313,647



1,844



2.35

%


387,460



2,151



2.22

%


427,363



2,394



2.24

%

FHLB stock

7,575



285



4.54

%


27,761



218



3.12

%


33,302



401



4.84

%


37,098



467



5.06

%


38,651



499



5.12

%

Other interest-earning deposits

325,889



300



0.36

%


91,243



114



0.49

%


63,950



70



0.43

%


43,578



59



0.54

%


40,410



13



0.13

%

Total interest-earning assets

8,946,515



90,936



4.04

%


8,193,386



85,672



4.16

%


8,126,345



86,510



4.28

%


8,175,439



86,269



4.24

%


8,174,763



86,635



4.20

%

Noninterest earning assets (e)

677,888







835,500







755,713







735,562







747,317






Total assets

$

9,624,403







$

9,028,886







$

8,882,058







$

8,911,001







$

8,922,080




































Liabilities and shareholders' equity:






























Interest-bearing liabilities:






























Savings deposits

$

1,668,492



771



0.18

%


$

1,485,763



744



0.20

%


$

1,440,886



837



0.23

%


$

1,405,800



865



0.25

%


$

1,378,377



871



0.25

%

Interest-bearing demand deposits

1,431,671



85



0.02

%


1,179,557



78



0.03

%


1,130,122



144



0.05

%


1,093,839



156



0.06

%


1,083,524



157



0.06

%

Money market deposit accounts

1,890,220



1,101



0.23

%


1,418,779



826



0.23

%


1,294,381



829



0.26

%


1,288,535



865



0.27

%


1,279,181



873



0.27

%

Time deposits

1,643,785



3,902



0.94

%


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

%

Borrowed funds (f)

143,540



61



0.17

%


560,407



657



0.47

%


772,225



3,017



1.57

%


899,439



6,539



2.92

%


906,574



6,730



2.95

%

Junior subordinated debentures

111,213



1,171



4.12

%


111,213



1,144



4.03

%


111,213



1,126



4.01

%


111,213



1,119



3.98

%


116,626



1,321



4.43

%

Total interest-bearing liabilities

6,888,921



7,091



0.41

%


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

%

Noninterest-bearing demand deposits (g)

1,493,528







1,243,474







1,184,786







1,161,151







1,145,276






Noninterest bearing liabilities

77,827







276,014







177,300







122,667







133,323






Total liabilities

8,460,276







7,872,749







7,727,173







7,746,966







7,763,776






Shareholders' equity

1,164,127







1,156,137







1,154,885







1,164,035







1,158,304






Total liabilities and shareholders' equity

$

9,624,403







$

9,028,886







$

8,882,058







$

8,911,001







$

8,922,080






Net interest income/ Interest rate spread



83,845



3.63

%




78,218



3.69

%




76,502



3.65

%




72,523



3.38

%




72,149



3.31

%

Net interest-earning assets/ Net interest margin

$

2,057,594





3.75

%


$

1,840,125





3.82

%


$

1,761,258





3.77

%


$

1,712,291





3.57

%


$

1,689,586





3.53

%

Ratio of interest-earning assets to interest-bearing liabilities

1.30X







1.29X







1.28X







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 0.29%, 0.32%, 0.35%, 0.37% and 0.39%, respectively.

(h) Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 4.41%, 4.38%, 4.52%, 4.50% and 4.49%, respectively, Investment securities - 1.61%, 1.89%, 1.87%, 1.82% and 1.82%, respectively, Interest-earning assets - 4.00%, 4.11%, 4.23%, 4.20% and 4.16%, respectively. GAAP basis net interest rate spreads were 3.59%, 3.65%, 3.60%, 3.34% and 3.27%, respectively, and GAAP basis net interest margins were 3.71%, 3.77%, 3.72%, 3.55% and 3.48%, 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.


Year Ended December 31,


2016


2015


Average

Balance


Interest


Avg.

Yield/

Cost (h)


Average

Balance


Interest


Avg.

Yield/

Cost (h)

Assets:












Interest-earning assets:












Residential mortgage loans

$

2,749,314



114,991



4.18

%


$

2,601,111



114,937



4.42

%

Home equity loans

1,220,220



52,671



4.32

%


1,105,887



47,836



4.33

%

Consumer loans

552,537



35,930



6.50

%


338,364



28,770



8.50

%

Commercial real estate loans

2,392,290



107,231



4.41

%


2,024,542



92,217



4.49

%

Commercial loans

477,095



20,499



4.23

%


390,174



16,878



4.27

%

Loans receivable (a) (b) (d)

7,391,456



331,322



4.48

%


6,460,078



300,638



4.65

%

Mortgage-backed securities (c)

467,560



8,540



1.83

%


500,797



8,823



1.77

%

Investment securities (c) (d)

344,575



7,612



2.21

%


469,568



11,155



2.38

%

FHLB stock (i)

26,386



1,371



5.20

%


37,500



2,828



4.77

%

Other interest-earning deposits

100,336



543



0.53

%


179,201



431



0.24

%

Total interest-earning assets

8,330,313



349,388



4.19

%


7,647,144



323,875



4.22

%

Noninterest earning assets (e)

781,274







677,449






Total assets

$

9,111,587







$

8,324,593


















Liabilities and shareholders' equity:












Interest-bearing liabilities:












Savings deposits

$

1,500,655



3,218



0.21

%


$

1,300,102



3,387



0.26

%

Interest-bearing demand deposits

1,209,325



462



0.04

%


976,789



568



0.06

%

Money market deposit accounts

1,473,897



3,621



0.25

%


1,202,143



3,222



0.27

%

Time deposits

1,630,424



16,164



0.99

%


1,540,905



16,878



1.10

%

Borrowed funds (f)

592,581



10,274



1.73

%


925,683



27,347



2.95

%

Junior subordinated debentures

111,213



4,560



4.03

%


108,507



4,925



4.48

%

Total interest-bearing liabilities

6,518,095



38,299



0.59

%


6,054,129



56,327



0.93

%

Noninterest-bearing demand deposits (g)

1,245,320







1,001,263






Noninterest bearing liabilities

188,381







166,530






Total liabilities

7,951,796







7,221,922






Shareholders' equity

1,159,791







1,102,671






Total liabilities and shareholders' equity

$

9,111,587







$

8,324,593






Net interest income/ Interest rate spread



311,089



3.60

%




267,548



3.29

%

Net interest-earning assets/ Net interest margin

$

1,812,218





3.73

%


$

1,593,015





3.49

%

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 0.33%, and 0.40%, respectively.

(h) Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 4.45% and 4.62%, respectively, Investment securities - 1.78% and 1.88%, respectively, Interest-earning assets - 4.15% and 4.17%, respectively. GAAP basis net interest rate spreads were 3.56% and 3.24%, respectively, and GAAP basis net interest margins were 3.69% and 3.43%, respectively.

(i) The average yield calculation excludes the $1.0 million special dividend paid in February 2015, the average yield was 7.54% with the special dividend included.

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/northwest-bancshares-inc-announces-record-fourth-quarter-2016-earnings-and-quarterly-dividend-increase-300394756.html

SOURCE Northwest Bancshares, Inc.


Source: PR Newswire (January 23, 2017 - 11:29 AM EST)

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