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8-K - 8-K - Northwest Bancshares, Inc.a15-9408_18k.htm

EXHIBIT 99.1

 

PRESS RELEASE OF NORTHWEST BANCSHARES, INC.

 



 

EARNINGS RELEASE

 

FOR IMMEDIATE RELEASE

 

Contact:

 

William J. Wagner, President and Chief Executive Officer (814) 726-2140

 

 

William W. Harvey, Jr., Senior Executive Vice President and Chief Financial Officer (814) 726-2140

 

Northwest Bancshares, Inc. Announces First Quarter 2015 Earnings and Quarterly Dividend

 

Warren, Pennsylvania — April 20, 2015

 

Northwest Bancshares, Inc. (NasdaqGS: NWBI) announced net income for the quarter ended March 31, 2015 of $16.2 million, or $0.18 per diluted share. This represents an increase of $1.6 million, or 10.7%, compared to the same quarter last year 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 March 31, 2015 were 6.17% and 0.83% compared to 5.15% and 0.75% for the same quarter last year.

 

The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.14 per share payable on May 14, 2015, to shareholders of record as of April 30, 2015.  This represents the 82nd consecutive quarter in which the Company has paid a cash dividend.

 

In making this announcement, William J. Wagner, President and CEO, noted, “The first quarter of 2015 was highlighted by solid loan growth of $75 million, further improvement in asset quality and continued consistency in our interest rate spread and margin. We also continued to demonstrate success in increasing checking and fee-based products while controlling operating costs through enhanced efficiency. The management of capital remains a focal point, and we were pleased this quarter to utilize excess capital by paying an attractive regular dividend and repurchasing 318,000 of our shares at an average share price of $11.92.”

 



 

Net interest income increased by $732,000, or 1.2%, to $61.6 million for the quarter ended March 31, 2015, from $60.8 million for the quarter ended March 31, 2014. This increase was due primarily to an increase in interest income on loans receivable of $1.4 million and a decrease in interest paid on deposit accounts of $724,000.  Partially offsetting these factors was a decrease in interest received on investment securities of $901,000 and an increase in interest paid on borrowed funds of $419,000.  The favorable changes from the previous year were due primarily to loan growth of more than $200.0 million and continued success in increasing low-cost deposits.

 

The provision for loan losses decreased by $6.6 million, or 88.0%, to $900,000 for the quarter ended March 31, 2015, from $7.5 million for the quarter ended March 31, 2014. The minimal provision for loan losses reflects continued improvements in asset quality as loans 90 days or more delinquent decreased $18.5 million, or 36.0%, compared to a year ago while total nonaccrual loans decreased $35.8 million, or 32.8%.

 

Noninterest income decreased by $3.7 million, or 18.5%, to $16.0 million for the quarter ended March 31, 2015, from $19.7 million for the quarter ended March 31, 2014.  This decrease is due primarily to decreases in gain on sale of investments of $3.3 million and an increase in loss on real estate owned of $911,000. The prior year gain on sale of investments resulted from the sale of $6.1 million of bank stocks while the loss on real estate owned was due primarily to the write-down of one commercial property. Partially offsetting these factors was an increase in other operating income of $788,000, due primarily to a special dividend of $1.0 million from the Federal Home Loan Bank of Pittsburgh.

 

Noninterest expense increased by $548,000, or 1.0%, to $53.7 million for the quarter ended March 31, 2015, from $53.2 million for the quarter ended March 31, 2014. Processing expenses increased by $616,000 due primarily to amortization of software upgrades made during the past two years. Marketing expenses increased by $339,000 due primarily to the timing of various campaign costs. Additionally, expenses totaling $347,000 were incurred during the quarter ended March 31, 2015 which related to the proposed acquisition of LNB Bancorp, Inc.

 

On December 15, 2014, the Company announced that it had entered into a definitive merger agreement to acquire LNB Bancorp, Inc. and its wholly-owned subsidiary, Lorain National Bank which operates 20 community banking offices in northeast Ohio and, as of December 31, 2014, had assets of approximately $1.2 billion.  The acquisition is expected to close during the third quarter of 2015.

 



 

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 161 community banking offices 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.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 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.

 

Important Additional Information and Where to Find It

 

In connection with the proposed acquisition of LNB Bancorp, Inc. on March 9, 2015 the Company filed a Registration Statement on Form S-4 with the SEC that includes a preliminary Proxy Statement of LNB Bancorp, Inc. and a preliminary Prospectus of Northwest Bancshares, as well as other relevant documents concerning the proposed transaction. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. SHAREHOLDERS OF LNB BANCORP ARE URGED TO READ THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS REGARDING THE MERGER AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.

 

A free copy of the Proxy Statement/Prospectus, as well as other filings containing information about Northwest Bancshares and LNB Bancorp, may be obtained at the SEC’s Internet site (http://www.sec.gov). You will also be able to obtain these documents, free of charge, from Northwest Bancshares at www.northwestsavingsbank.com under the heading “Investor Relations” and then under “SEC Filings” or from LNB Bancorp by accessing LNB Bancorp’s website at www.4lnb.com under the heading “Investor Relations” and then under “SEC Filings.” Copies of the Proxy Statement/Prospectus can also be obtained, free of charge, by directing a request to Northwest Bancshares, Inc., 100 Liberty Street, Warren, Pennsylvania 16365, Attention: Investor Relations, Telephone: (814) 726-2140 or to LNB Bancorp, Inc., 457 Broadway, Lorain, Ohio 44052, Attention: Investor Relations, Telephone: (440) 244-7317.

 

LNB Bancorp and Northwest Bancshares and certain of their directors and executive officers may be deemed to be participants in the solicitation of proxies from the shareholders of LNB Bancorp in connection with the proposed merger. Information about the directors and executive officers of LNB Bancorp and their ownership of LNB Bancorp common stock is set forth in the proxy statement for LNB Bancorp’s 2014 annual meeting of shareholders, as filed with the SEC on Schedule 14A on March 11, 2014. Information about the directors and executive officers of Northwest Bancshares is set forth in the proxy statement for Northwest Bancshares’ 2015 annual meeting of shareholders, as filed with the SEC on a Schedule 14A on March 4, 2015.  Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the Proxy Statement/Prospectus regarding the proposed merger. Free copies of this document may be obtained as described in the preceding paragraph.

 



 

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Financial Condition

(Dollars in thousands, except per share amounts)

 

 

 

March 31,

 

December 31,

 

 

 

2015

 

2014

 

Assets

 

 

 

 

 

Cash and cash equivalents

 

$

83,970

 

87,401

 

Interest-earning deposits in other financial institutions

 

212,496

 

152,671

 

Federal funds sold and other short-term investments

 

635

 

634

 

Marketable securities available-for-sale (amortized cost of $906,028 and $906,702)

 

916,423

 

912,371

 

Marketable securities held-to-maturity (fair value of $92,989 and $106,292)

 

90,825

 

103,695

 

Total cash, interest-earning deposits and marketable securities

 

1,304,349

 

1,256,772

 

 

 

 

 

 

 

Residential mortgage loans

 

2,543,870

 

2,521,456

 

Home equity loans

 

1,055,739

 

1,066,131

 

Other consumer loans

 

239,956

 

242,744

 

Commercial real estate loans

 

1,856,574

 

1,801,184

 

Commercial loans

 

368,725

 

358,376

 

Total loans receivable

 

6,064,864

 

5,989,891

 

Allowance for loan losses

 

(67,298

)

(67,518

)

Loans receivable, net

 

5,997,566

 

5,922,373

 

 

 

 

 

 

 

Federal Home Loan Bank stock, at cost

 

36,292

 

33,293

 

Accrued interest receivable

 

19,753

 

18,623

 

Real estate owned, net

 

15,346

 

16,759

 

Premises and Equipment, net

 

142,481

 

143,909

 

Bank owned life insurance

 

145,275

 

144,362

 

Goodwill

 

175,498

 

175,323

 

Other intangible assets

 

3,027

 

3,033

 

Other assets

 

50,772

 

60,586

 

Total assets

 

$

7,890,359

 

7,775,033

 

 

 

 

 

 

 

Liabilities and Shareholders’ equity

 

 

 

 

 

Liabilities

 

 

 

 

 

Noninterest-bearing demand deposits

 

$

944,937

 

891,248

 

Interest-bearing demand deposits

 

898,945

 

874,623

 

Money market deposit accounts

 

1,151,971

 

1,179,070

 

Savings deposits

 

1,257,446

 

1,209,287

 

Time deposits

 

1,428,768

 

1,478,314

 

Total deposits

 

5,682,067

 

5,632,542

 

Borrowed funds

 

943,842

 

888,109

 

Advances by borrowers for taxes and insurance

 

34,998

 

30,507

 

Accrued interest payable

 

1,336

 

936

 

Other liabilities

 

57,506

 

57,198

 

Junior subordinated debentures

 

103,094

 

103,094

 

Total liabilities

 

6,822,843

 

6,712,386

 

 

 

 

 

 

 

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, 94,553,350 shares and 94,721,453 shares issued and outstanding, respectively

 

946

 

947

 

Paid-in-capital

 

624,584

 

626,134

 

Retained earnings

 

484,774

 

481,577

 

Unallocated common stock of Employee Stock Ownership Plan

 

(21,565

)

(21,641

)

Accumulated other comprehensive loss

 

(21,223

)

(24,370

)

Total shareholders’ equity

 

1,067,516

 

1,062,647

 

Total liabilities and shareholders’ equity

 

$

7,890,359

 

7,775,033

 

 

 

 

 

 

 

Equity to assets

 

13.53

%

13.67

%

Tangible common equity to assets

 

11.53

%

11.64

%

Book value per share

 

$

11.29

 

11.22

 

Tangible book value per share

 

$

9.40

 

9.34

 

Closing market price per share

 

$

11.85

 

12.53

 

Full time equivalent employees

 

2,041

 

2,042

 

Number of banking offices

 

161

 

162

 

 



 

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Income

(Dollars in thousands, except per share amounts)

 

 

 

Quarter ended

 

 

 

March 31,

 

December 31,

 

 

 

2015

 

2014

 

2014

 

Interest income:

 

 

 

 

 

 

 

Loans receivable

 

$

70,711

 

69,322

 

71,182

 

Mortgage-backed securities

 

2,234

 

2,793

 

2,357

 

Taxable investment securities

 

1,045

 

1,080

 

1,032

 

Tax-free investment securities

 

1,348

 

1,655

 

1,467

 

Interest-earning deposits

 

139

 

200

 

164

 

Total interest income

 

75,477

 

75,050

 

76,202

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

Deposits

 

5,766

 

6,490

 

6,106

 

Borrowed funds

 

8,133

 

7,714

 

7,876

 

Total interest expense

 

13,899

 

14,204

 

13,982

 

 

 

 

 

 

 

 

 

Net interest income

 

61,578

 

60,846

 

62,220

 

Provision for loan losses

 

900

 

7,485

 

1,078

 

Net interest income after provision for loan losses

 

60,678

 

53,361

 

61,142

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

Gain on sale of investments

 

95

 

3,348

 

381

 

Service charges and fees

 

8,659

 

8,408

 

9,268

 

Trust and other financial services income

 

2,776

 

3,047

 

3,291

 

Insurance commission income

 

2,428

 

2,564

 

2,181

 

Loss on real estate owned, net

 

(1,046

)

(135

)

(30

)

Income from bank owned life insurance

 

913

 

1,001

 

1,057

 

Mortgage banking income

 

240

 

249

 

269

 

Other operating income

 

1,963

 

1,175

 

1,188

 

Total noninterest income

 

16,028

 

19,657

 

17,605

 

 

 

 

 

 

 

 

 

Noninterest expense:

 

 

 

 

 

 

 

Compensation and employee benefits

 

27,895

 

27,972

 

31,405

 

Premises and occupancy costs

 

6,267

 

6,557

 

5,516

 

Office operations

 

3,680

 

3,757

 

3,677

 

Processing expenses

 

7,205

 

6,589

 

6,720

 

Marketing expenses

 

1,976

 

1,637

 

1,434

 

Federal deposit insurance premiums

 

1,347

 

1,297

 

1,316

 

Professional services

 

1,792

 

2,062

 

1,970

 

Amortization of intangible assets

 

268

 

331

 

331

 

Real estate owned expense

 

692

 

639

 

406

 

Acquisition expense

 

347

 

 

394

 

Other expense

 

2,242

 

2,322

 

2,043

 

Total noninterest expense

 

53,711

 

53,163

 

55,212

 

 

 

 

 

 

 

 

 

Income before income taxes

 

22,995

 

19,855

 

23,535

 

Income tax expense

 

6,825

 

5,244

 

6,190

 

 

 

 

 

 

 

 

 

Net income

 

$

16,170

 

14,611

 

17,345

 

 

 

 

 

 

 

 

 

Basic earnings per share

 

$

0.18

 

0.16

 

0.19

 

 

 

 

 

 

 

 

 

Diluted earnings per share

 

$

0.18

 

0.16

 

0.19

 

 

 

 

 

 

 

 

 

Annualized return on average equity

 

6.17

%

5.15

%

6.42

%

Annualized return on average assets

 

0.83

%

0.75

%

0.88

%

 

 

 

 

 

 

 

 

Basic common shares outstanding

 

91,634,064

 

91,154,998

 

91,741,487

 

Diluted common shares outstanding

 

91,902,071

 

92,353,312

 

92,103,069

 

 



 

Northwest Bancshares, Inc. and Subsidiaries

Asset quality

(Dollars in thousands)

 

 

 

March 31, 2015

 

December 31,
2014

 

March 31, 2014

 

December 31,
2013

 

Nonaccrual loans current:

 

 

 

 

 

 

 

 

 

Residential mortgage loans

 

$

1,322

 

1,169

 

1,064

 

1,361

 

Home equity loans

 

1,910

 

1,527

 

1,771

 

835

 

Other consumer loans

 

114

 

88

 

136

 

98

 

Commercial real estate loans

 

18,465

 

23,703

 

26,564

 

17,866

 

Commercial loans

 

9,429

 

5,917

 

19,603

 

13,357

 

Total nonaccrual loans current

 

$

31,240

 

32,404

 

49,138

 

33,517

 

 

 

 

 

 

 

 

 

 

 

Nonaccrual loans delinquent 30 days to 59 days:

 

 

 

 

 

 

 

 

 

Residential mortgage loans

 

$

951

 

1,545

 

741

 

427

 

Home equity loans

 

380

 

712

 

155

 

404

 

Other consumer loans

 

92

 

48

 

36

 

15

 

Commercial real estate loans

 

3,907

 

1,128

 

4,118

 

3,468

 

Commercial loans

 

144

 

9

 

5

 

7,650

 

Total nonaccrual loans delinquent 30 days to 59 days

 

$

5,474

 

3,442

 

5,055

 

11,964

 

 

 

 

 

 

 

 

 

 

 

Nonaccrual loans delinquent 60 days to 89 days:

 

 

 

 

 

 

 

 

 

Residential mortgage loans

 

$

1,892

 

784

 

1,914

 

864

 

Home equity loans

 

507

 

724

 

485

 

280

 

Other consumer loans

 

129

 

234

 

99

 

87

 

Commercial real estate loans

 

1,045

 

763

 

902

 

2,036

 

Commercial loans

 

107

 

131

 

95

 

716

 

Total nonaccrual loans delinquent 60 days to 89 days

 

$

3,680

 

2,636

 

3,495

 

3,983

 

 

 

 

 

 

 

 

 

 

 

Nonaccrual loans delinquent 90 days or more:

 

 

 

 

 

 

 

 

 

Residential mortgage loans

 

$

15,068

 

17,696

 

20,564

 

24,625

 

Home equity loans

 

5,646

 

6,606

 

8,420

 

8,344

 

Other consumer loans

 

2,045

 

2,450

 

1,818

 

2,057

 

Commercial real estate loans

 

8,233

 

10,215

 

16,098

 

18,433

 

Commercial loans

 

1,921

 

4,359

 

4,494

 

4,298

 

Total nonaccrual loans delinquent 90 days or more

 

$

32,913

 

41,326

 

51,394

 

57,757

 

 

 

 

 

 

 

 

 

 

 

Total nonaccrual loans

 

$

73,307

 

79,808

 

109,082

 

107,221

 

 

 

 

March 31,

 

December 31,

 

March 31,

 

December 31,

 

 

 

2015

 

2014

 

2014

 

2013

 

Nonaccrual loans

 

$

73,307

 

79,808

 

109,082

 

107,221

 

Loans 90 days past maturity and still accruing

 

310

 

235

 

709

 

690

 

Nonperforming loans

 

73,617

 

80,043

 

109,791

 

107,911

 

Real estate owned, net

 

15,346

 

16,759

 

16,692

 

18,203

 

Nonperforming assets

 

$

88,963

 

96,802

 

126,483

 

126,114

 

 

 

 

 

 

 

 

 

 

 

Nonaccrual troubled debt restructuring *

 

$

19,843

 

24,459

 

34,268

 

28,889

 

Accruing troubled debt restructuring

 

40,802

 

37,329

 

40,243

 

50,277

 

Total troubled debt restructuring

 

$

60,645

 

61,788

 

74,511

 

79,166

 

 

 

 

 

 

 

 

 

 

 

Nonperforming loans to total loans

 

1.21

%

1.34

%

1.88

%

1.86

%

 

 

 

 

 

 

 

 

 

 

Nonperforming assets to total assets

 

1.13

%

1.25

%

1.59

%

1.60

%

 

 

 

 

 

 

 

 

 

 

Allowance for loan losses to total loans

 

1.11

%

1.13

%

1.30

%

1.23

%

 

 

 

 

 

 

 

 

 

 

Allowance for loan losses to nonperforming loans

 

91.42

%

84.35

%

69.44

%

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)

 

 

 

March 31,

 

 

 

December 31,

 

 

 

March 31,

 

 

 

December 31,

 

 

 

 

 

2015

 

*

 

2014

 

*

 

2014

 

*

 

2013

 

*

 

Loans delinquent 30 days to 59 days:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage loans

 

336

 

$

25,586

 

1.0

%

377

 

$

27,443

 

1.1

%

352

 

$

26,874

 

1.1

%

374

 

$

27,486

 

1.1

%

Home equity loans

 

128

 

3,737

 

0.4

%

161

 

5,752

 

0.5

%

172

 

5,449

 

0.5

%

213

 

6,946

 

0.6

%

Consumer loans

 

912

 

4,374

 

1.8

%

1,193

 

5,572

 

2.3

%

749

 

3,412

 

1.5

%

1,010

 

4,515

 

2.0

%

Commercial real estate loans

 

50

 

5,497

 

0.3

%

56

 

4,956

 

0.3

%

84

 

26,518

 

1.6

%

73

 

8,449

 

0.5

%

Commercial loans

 

36

 

1,480

 

0.4

%

26

 

2,262

 

0.6

%

41

 

1,375

 

0.3

%

34

 

9,243

 

2.3

%

Total loans delinquent 30 days to 59 days

 

1,462

 

$

40,674

 

0.7

%

1,813

 

$

45,985

 

0.8

%

1,398

 

$

63,628

 

1.1

%

1,704

 

$

56,639

 

1.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans delinquent 60 days to 89 days:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage loans

 

40

 

$

3,397

 

0.1

%

100

 

$

6,970

 

0.3

%

46

 

$

3,674

 

0.1

%

103

 

$

7,568

 

0.3

%

Home equity loans

 

34

 

1,404

 

0.1

%

49

 

1,672

 

0.2

%

42

 

1,437

 

0.1

%

67

 

2,243

 

0.2

%

Consumer loans

 

352

 

1,515

 

0.6

%

525

 

2,435

 

1.0

%

330

 

1,289

 

0.6

%

507

 

1,866

 

0.8

%

Commercial real estate loans

 

21

 

2,351

 

0.1

%

21

 

2,038

 

0.1

%

33

 

2,570

 

0.2

%

35

 

3,968

 

0.2

%

Commercial loans

 

5

 

136

 

0.0

%

4

 

209

 

0.1

%

9

 

473

 

0.1

%

16

 

1,555

 

0.4

%

Total loans delinquent 60 days to 89 days

 

452

 

$

8,803

 

0.1

%

699

 

$

13,324

 

0.2

%

460

 

$

9,443

 

0.2

%

728

 

$

17,200

 

0.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans delinquent 90 days or more:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage loans

 

193

 

$

15,068

 

0.6

%

225

 

$

17,696

 

0.7

%

236

 

$

20,564

 

0.8

%

273

 

$

24,625

 

1.0

%

Home equity loans

 

123

 

5,646

 

0.5

%

139

 

6,606

 

0.6

%

176

 

8,420

 

0.8

%

171

 

8,344

 

0.8

%

Consumer loans

 

440

 

2,045

 

0.9

%

539

 

2,450

 

1.0

%

391

 

1,818

 

0.8

%

470

 

2,057

 

0.9

%

Commercial real estate loans

 

84

 

8,233

 

0.4

%

102

 

10,215

 

0.6

%

116

 

16,098

 

1.0

%

124

 

18,433

 

1.1

%

Commercial loans

 

16

 

1,921

 

0.5

%

25

 

4,359

 

1.2

%

33

 

4,494

 

1.1

%

31

 

4,298

 

1.1

%

Total loans delinquent 90 days or more

 

856

 

$

32,913

 

0.5

%

1,030

 

$

41,326

 

0.7

%

952

 

$

51,394

 

0.9

%

1,069

 

$

57,757

 

1.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans delinquent

 

2,770

 

$

82,390

 

1.4

%

3,542

 

$

100,635

 

1.7

%

2,810

 

$

124,465

 

2.1

%

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 March 31, 2015

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

Recorded

 

 

 

 

 

 

 

 

 

 

 

 

 

investment

 

 

 

 

 

Special

 

 

 

 

 

 

 

in loans

 

 

 

Pass

 

mention

 

Substandard

 

Doubtful

 

Loss

 

receivable

 

Personal Banking:

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage loans

 

$

2,531,595

 

 

10,851

 

 

1,424

 

2,543,870

 

Home equity loans

 

1,050,092

 

 

5,647

 

 

 

1,055,739

 

Other consumer loans

 

238,381

 

 

1,575

 

 

 

239,956

 

Total Personal Banking

 

3,820,068

 

 

18,073

 

 

1,424

 

3,839,565

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Banking:

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans

 

1,671,331

 

43,874

 

141,369

 

 

 

1,856,574

 

Commercial loans

 

305,632

 

22,651

 

31,243

 

9,199

 

 

368,725

 

Total Business Banking

 

1,976,963

 

66,525

 

172,612

 

9,199

 

 

2,225,299

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

5,797,031

 

66,525

 

190,685

 

9,199

 

1,424

 

6,064,864

 

 

Northwest Bancshares, Inc. and Subsidiaries

Loans by credit quality indicators as of December 31, 2014

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

Recorded

 

 

 

 

 

 

 

 

 

 

 

 

 

investment

 

 

 

 

 

Special

 

 

 

 

 

 

 

in loans

 

 

 

Pass

 

mention

 

Substandard

 

Doubtful

 

Loss

 

receivable

 

Personal Banking:

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage loans

 

$

2,507,269

 

 

12,763

 

 

1,424

 

2,521,456

 

Home equity loans

 

1,059,525

 

 

6,606

 

 

 

1,066,131

 

Other consumer loans

 

240,947

 

 

1,797

 

 

 

242,744

 

Total Personal Banking

 

3,807,741

 

 

21,166

 

 

1,424

 

3,830,331

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Banking:

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans

 

1,618,269

 

36,908

 

145,502

 

505

 

 

1,801,184

 

Commercial loans

 

286,234

 

23,690

 

46,280

 

2,172

 

 

358,376

 

Total Business Banking

 

1,904,503

 

60,598

 

191,782

 

2,677

 

 

2,159,560

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

5,712,244

 

60,598

 

212,948

 

2,677

 

1,424

 

5,989,891

 

 



 

Northwest Bancshares, Inc. and Subsidiaries

Allowance for loan losses

(Dollars in thousands)

 

 

 

Quarter ended

 

Year ended

 

 

 

March 31,

 

December 31,

 

 

 

2015

 

2014

 

2014

 

2013

 

Allowance for loan losses

 

 

 

 

 

 

 

 

 

Beginning balance

 

$

67,518

 

71,348

 

71,348

 

73,219

 

Provision

 

900

 

7,485

 

20,314

 

18,519

 

Charge-offs residential mortgage

 

(335

)

(459

)

(2,181

)

(2,501

)

Charge-offs home equity

 

(342

)

(372

)

(1,783

)

(2,239

)

Charge-offs other consumer

 

(1,940

)

(1,716

)

(6,423

)

(6,055

)

Charge-offs commercial real estate

 

(1,113

)

(932

)

(8,422

)

(10,042

)

Charge-offs commercial

 

(724

)

(770

)

(11,936

)

(5,007

)

Recoveries

 

3,334

 

1,650

 

6,601

 

5,454

 

Ending balance

 

$

67,298

 

76,234

 

67,518

 

71,348

 

 

 

 

 

 

 

 

 

 

 

Net charge-offs to average loans, annualized

 

0.07

%

0.18

%

0.41

%

0.36

%

 



 

Northwest Bancshares, Inc. and Subsidiaries

Average balance sheet

(Dollars in thousands)

 

The following table sets forth certain information relating to the Company’s average balance sheet and reflects the average yield on assets and average cost of liabilities for the periods indicated.  Such yields and costs are derived by dividing income or expense by the average balance of assets or liabilities, respectively, for the periods presented.  Average balances are calculated using daily averages.

 

 

 

Quarter ended March 31,

 

 

 

2015

 

2014

 

 

 

 

 

 

 

Avg.

 

 

 

 

 

Avg.

 

 

 

Average

 

 

 

Yield/

 

Average

 

 

 

Yield/

 

 

 

Balance

 

Interest

 

Cost (g)

 

Balance

 

Interest

 

Cost (g)

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans receivable (a) (b) (d)

 

$

6,019,250

 

71,182

 

4.80

%

$

5,823,527

 

69,865

 

4.87

%

Mortgage-backed securities (c) 

 

506,778

 

2,234

 

1.76

%

621,146

 

2,793

 

1.80

%

Investment securities (c) (d) 

 

486,078

 

3,119

 

2.57

%

507,354

 

3,627

 

2.86

%

FHLB stock (h)

 

36,139

 

363

 

4.07

%

43,715

 

275

 

2.55

%

Other interest-earning deposits

 

246,296

 

139

 

0.23

%

351,615

 

200

 

0.23

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-earning assets

 

7,294,541

 

77,037

 

4.28

%

7,347,357

 

76,760

 

4.23

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest earning assets (e)

 

595,425

 

 

 

 

 

583,122

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

7,889,966

 

 

 

 

 

$

7,930,479

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and shareholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Savings deposits

 

$

1,231,745

 

813

 

0.27

%

$

1,208,349

 

804

 

0.27

%

Interest-bearing demand deposits

 

878,230

 

131

 

0.06

%

851,723

 

139

 

0.07

%

Money market deposit accounts

 

1,165,159

 

765

 

0.27

%

1,173,957

 

782

 

0.27

%

Time deposits

 

1,452,476

 

4,057

 

1.13

%

1,642,224

 

4,765

 

1.18

%

Borrowed funds (f)

 

960,812

 

6,975

 

2.94

%

881,187

 

6,557

 

3.02

%

Junior subordinated debentures

 

103,094

 

1,158

 

4.49

%

103,094

 

1,157

 

4.49

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-bearing liabilities

 

5,791,516

 

13,899

 

0.97

%

5,860,534

 

14,204

 

0.98

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand deposits

 

914,025

 

 

 

 

 

815,117

 

 

 

 

 

Noninterest bearing liabilities

 

121,121

 

 

 

 

 

105,027

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

6,826,662

 

 

 

 

 

6,780,678

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders’ equity

 

1,063,304

 

 

 

 

 

1,149,801

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

7,889,966

 

 

 

 

 

$

7,930,479

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income/ Interest rate spread

 

 

 

63,138

 

3.31

%

 

 

62,556

 

3.25

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest-earning assets/ Net interest margin

 

$

1,503,025

 

 

 

3.51

%

$

1,486,823

 

 

 

3.45

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of interest-earning assets to interest-bearing liabilities

 

1.26

X

 

 

 

 

1.25

X

 

 

 

 

 


(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) Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 4.76% and 4.83%, respectively, Investment securities - 1.97% and 2.16%, respectively, Interest-earning assets - 4.21% and 4.15%, respectively. GAAP basis net interest rate spreads were 3.24% and 3.17%, respectively, and GAAP basis net interest margins were 3.44% and 3.37%, respectively.

(h) Excludes a $1.0 million special dividend paid in February 2015.

 



 

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

 

 

 

March 31, 2015

 

December 31, 2014

 

 

 

 

 

 

 

Avg.

 

 

 

 

 

Avg.

 

 

 

Average

 

 

 

Yield/

 

Average

 

 

 

Yield/

 

 

 

Balance

 

Interest

 

Cost (g)

 

Balance

 

Interest

 

Cost (g)

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans receivable (a) (b) (d)

 

$

6,019,250

 

71,182

 

4.80

%

$

5,961,303

 

71,669

 

4.77

%

Mortgage-backed securities (c) 

 

506,778

 

2,234

 

1.76

%

536,990

 

2,357

 

1.76

%

Investment securities (c) (d) 

 

486,078

 

3,119

 

2.57

%

495,554

 

3,289

 

2.65

%

FHLB stock (h)

 

36,139

 

363

 

4.07

%

36,315

 

383

 

4.22

%

Other interest-earning deposits

 

246,296

 

139

 

0.23

%

251,229

 

164

 

0.26

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-earning assets

 

7,294,541

 

77,037

 

4.28

%

7,281,391

 

77,862

 

4.28

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest earning assets (e)

 

595,425

 

 

 

 

 

546,946

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

7,889,966

 

 

 

 

 

$

7,828,337

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and shareholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Savings deposits

 

$

1,231,745

 

813

 

0.27

%

$

1,209,117

 

828

 

0.27

%

Interest-bearing demand deposits

 

878,230

 

131

 

0.06

%

884,542

 

147

 

0.07

%

Money market deposit accounts

 

1,165,159

 

765

 

0.27

%

1,182,041

 

797

 

0.27

%

Time deposits

 

1,452,476

 

4,057

 

1.13

%

1,506,526

 

4,334

 

1.14

%

Borrowed funds (f)

 

960,812

 

6,975

 

2.94

%

894,509

 

6,694

 

2.97

%

Junior subordinated debentures

 

103,094

 

1,158

 

4.49

%

103,094

 

1,182

 

4.49

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-bearing liabilities

 

5,791,516

 

13,899

 

0.97

%

5,779,829

 

13,982

 

0.96

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand deposits

 

914,025

 

 

 

 

 

897,082

 

 

 

 

 

Noninterest bearing liabilities

 

121,121

 

 

 

 

 

79,850

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

6,826,662

 

 

 

 

 

6,756,761

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders’ equity

 

1,063,304

 

 

 

 

 

1,071,576

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

7,889,966

 

 

 

 

 

$

7,828,337

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income/ Interest rate spread

 

 

 

63,138

 

3.31

%

 

 

63,880

 

3.32

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest-earning assets/ Net interest margin

 

$

1,503,025

 

 

 

3.51

%

$

1,501,562

 

 

 

3.51

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of interest-earning assets to interest-bearing liabilities

 

1.26

X

 

 

 

 

1.26

X

 

 

 

 

 


(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) Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 4.76% and 4.74%, respectively, Investment securities -1.97% and 2.02%, respectively, Interest-earning assets - 4.21% and 4.21%, respectively. GAAP basis net interest rate spreads were 3.24% and 3.25%, respectively, and GAAP basis net interest margins were 3.44% and 3.44%, respectively.

(h) Excludes a $1.0 million special dividend paid in February 2015.