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

NWBI

WARREN, Pa., Oct. 26, 2015 /PRNewswire/ -- Northwest Bancshares, Inc. (NasdaqGS: NWBI) announced net income for the quarter ended September 30, 2015 of $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, 2015 were 4.54% and 0.59%.  Earnings for the current quarter include acquisition expenses of $7.6 million relating to the merger of LNB Bancorp, Inc. ("LNB") on August 14, 2015.  Excluding the after-tax impact of these expenses, non-GAAP net operating income for the quarter was $17.9 million, or $0.19 per diluted share, compared to $17.3 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, 2015 were 6.30% and 0.82% compared to 6.43% and 0.87% in the previous year. 

The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.14 per share payable on November 19, 2015, to shareholders of record as of November 5, 2015.  This represents the 84th consecutive quarter in which the Company has paid a cash dividend. 

In making this announcement, William J. Wagner, President and CEO, noted, "We are pleased to have completed the acquisition of LNB Bancorp, Inc. and Lorain National Bank during the current quarter, our first acquisition of a bank since 2008.  This merger brings additional talent, twenty-one community banking offices and over 55,000 new customers to Northwest.  It also greatly increases our presence in a market that we feel presents great opportunities for our institution.  Because the transaction was closed mid-quarter, and because certain transitional expenses were incurred, the accretive impact on earnings from this merger will not be fully realized until the fourth quarter of 2015.  Finally, we believe the potential to leverage the benefits of this transaction will provide additional opportunities to enhance shareholder value.  We are also pleased to report solid earnings for the quarter as our net interest margin remained stable and noninterest income continues to improve.   Noninterest expense, exclusive of the impact of the LNB merger, continues to be controlled, and we remain focused on improving our efficiency." 

Net interest income increased by $4.6 million, or 7.4%, to $66.9 million for the quarter ended September 30, 2015, from $62.3 million for the quarter ended September 30, 2014. This increase is primarily due to a $5.3 million increase in interest income on loans, which was fueled by a $1.16 billion increase in the company's loan portfolio over the past twelve months.   The substantial increase in loans resulted from internal growth of $218.5 million, or 3.6%, for the first nine months of 2015, while the acquisition of LNB provided net loans of $943.2 million.  Also contributing to the increase in net interest income was a $142,000 decrease in interest on deposits, as the company's cost of funds decreased sufficiently over the past year to offset the cost of the $1.010 billion of deposits acquired during the quarter from the LNB merger.

The provision for loan losses decreased by $299,000, or 8.6%, to $3.2 million for the quarter ended September 30, 2015, from $3.5 million for the quarter ended September 30, 2014 as overall asset quality improved compared to last year. Loans 90 days or more delinquent decreased by $9.1 million, or 19.8%, to $36.8 million at September 30, 2015 from $45.9 million at September 30, 2014, while total nonaccrual loans decreased by $21.9 million, or 24.4%, to $67.9 million at September 30, 2015 from $89.8 million last year.

Noninterest income increased by $403,000, or 2.3%, to $18.1 million for the quarter ended September 30, 2015, from $17.7 million for the quarter ended September 30, 2014.  This increase is due primarily to an increase in insurance commission income of $620,000, or 34.9%, related to the company's acquisition of its third insurance agency over the past four years on January 1, 2015. Also contributing to the increase in noninterest income was an increase in service charges and fees of $280,000, or 2.9%. This increase was attributable to additional fees earned from the continued growth in checking accounts as well as from the additional checking accounts provided by the merger with LNB. Partially offsetting these increases was a decrease in gain on sale of investments of $592,000, as the company sold $1.4 million of bank stocks in 2014 at a considerable profit.

Noninterest expense increased by $10.4 million, or 19.6%, to $63.8 million for the quarter ended September 30, 2015, from $53.4 million for the quarter ended September 30, 2014. This increase resulted primarily to acquisition expenses of $7.6 million incurred during the current quarter relating to the merger of LNB.  The cost of the employees acquired in the LNB merger also contributed greatly to an increase in compensation and employee benefits of $3.0 million, or 10.5%, in the current quarter as compared to the previous year.  Also contributing to the increase in noninterest expense was an increase in processing expenses of $1.4 million, or 20.9%, due primarily to recent technology upgrades, including the implementation of enhanced customer security for online financial transactions.  Partially offsetting these increases to noninterest expense was a decrease in other expense of $1.4 million, or 43.6%, due primarily to the timing of charitable contributions.

Net income for the nine month period ended September 30, 2015 was $44.3 million, or $0.48 per diluted share. This represents a decrease of $270,000, or 0.6%, compared to the nine month period ended September 30, 2014, when net income was $44.6 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, 2015 were 5.47% and 0.73% compared to 5.44% and 0.75% for the same period last year.  This decrease is due primarily to the acquisition of LNB which generated acquisition expenses of $8.4 million as well as an increase in compensation and employee benefits of $3.2 million.   Also contributing to the decrease in net income was a decrease in the gain on sale of investments of $3.6 million as the company sold $3.4 million of bank stocks at a considerable gain. Offsetting these items which negatively impacted income was a reduction in the provision for loan losses of $14.1 million, or 73.4%, as asset quality continued to improve.  Non-GAAP net operating income for the nine month period ended September 30, 2015, which excludes the after-tax impact of the aforementioned acquisition expenses of $8.4 million, was $49.9 million, or $0.54 per diluted share. This represents an increase of $5.3 million, or 11.8%, compared to the nine month period ended September 30, 2014 when net income was $44.6 million, or $0.48 per diluted share. The non-GAAP annualized returns on average shareholders' equity and average assets for the nine month period ended September 30, 2015 were 6.15% and 0.82% compared to 5.44% and 0.75% for the same period last year. 

Headquartered in Warren, Pennsylvania, Northwest Bancshares, Inc. is the holding company of Northwest Savings Bank.  Founded in 1896, Northwest Savings Bank is a full-service financial institution offering a complete line of business and personal banking products, employee benefits and wealth management services, as well as the fulfillment of business and personal insurance needs. Northwest operates 181 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.  

Northwest Bancshares, Inc. and Subsidiaries


Consolidated Statements of Financial Condition (Unaudited)


(Dollars in thousands, except per share amounts)






















September 30,


December 31,


Assets


2015


2014


Cash and cash equivalents




$                      91,406


87,401


Interest-earning deposits in other financial institutions


3,206


152,671


Federal funds sold and other short-term investments


1,013


634


Marketable securities available-for-sale (amortized cost of $965,965 and $906,702)

976,677


912,371


Marketable securities held-to-maturity (fair value of $48,511 and $106,292)


47,299


103,695



Total cash, interest-earning deposits and marketable securities


1,119,601


1,256,772














Residential mortgage loans




2,712,537


2,521,456


Home equity loans 






1,203,190


1,066,131


Other consumer loans





494,714


242,744


Commercial real estate loans



2,330,864


1,801,184


Commercial loans






410,308


358,376



Total loans receivable




7,151,613


5,989,891


Allowance for loan losses




(60,547)


(67,518)



Loans receivable, net




7,091,066


5,922,373














Federal Home Loan Bank stock, at cost



40,115


33,293


Accrued interest receivable




22,098


18,623


Real estate owned, net





10,391


16,759


Premises and Equipment, net



153,841


143,909


Bank owned life insurance




167,258


144,362


Goodwill 






258,367


175,323


Other intangible assets





9,712


3,033


Other assets






62,459


60,586



Total assets






$              8,934,908


7,775,033














Liabilities and Shareholders' equity






Liabilities





Noninterest-bearing demand deposits



$              1,127,864


891,248


Interest-bearing demand deposits



1,097,969


874,623


Money market deposit accounts



1,277,878


1,179,070


Savings deposits






1,378,958


1,209,287


Time deposits






1,762,073


1,478,314



Total deposits






6,644,742


5,632,542


Borrowed funds






927,219


888,109


Advances by borrowers for taxes and insurance


18,216


30,507


Accrued interest payable




1,816


936


Other liabilities






62,246


57,198


Junior subordinated debentures



119,332


103,094



Total liabilities






7,773,571


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, 101,725,112 shares






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


1,017


947


Paid-in-capital






714,730


626,134


Retained earnings






487,048


481,577


Unallocated common stock of Employee Stock Ownership Plan


(21,398)


(21,641)


Accumulated other comprehensive loss



(20,060)


(24,370)



Total shareholders' equity



1,161,337


1,062,647



Total liabilities and shareholders' equity


$              8,934,908


7,775,033


















Equity to assets


13.00%


13.67%






Tangible common equity to assets


10.31%


11.64%






Book value per share


$                      11.42


11.22






Tangible book value per share


$                        8.78


9.34






Closing market price per share


$                      13.00


12.53






Full time equivalent employees


2,209


2,042






Number of banking offices


182


162














 

Northwest Bancshares, Inc. and Subsidiaries


Consolidated Statements of Income


(Dollars in thousands, except per share amounts)


















Quarter ended







September 30,


June 30,







2015


2014


2015


Interest income:









Loans receivable


$                    76,087


70,820


70,985



Mortgage-backed securities


2,230


2,504


2,058



Taxable investment securities


1,689


1,456


1,604



Tax-free investment securities


986


1,561


1,143



Interest-earning deposits


99


187


180




Total interest income


81,091


76,528


75,970













Interest expense:









Deposits


6,163


6,305


5,691



Borrowed funds


7,987


7,882


8,101




Total interest expense


14,150


14,187


13,792















Net interest income


66,941


62,341


62,178


Provision for loan losses


3,167


3,466


1,050




Net interest income after provision for loan losses


63,774


58,875


61,128













Noninterest income:









Gain on sale of investments


260


852


566



Service charges and fees


9,945


9,665


9,228



Trust and other financial services income


3,062


2,976


3,094



Insurance commission income


2,398


1,778


2,210



Loss on real estate owned, net


(246)


(240)


(541)



Income from bank owned life insurance


1,166


1,083


1,008



Mortgage banking income


267


239


218



Other operating income


1,288


1,384


742




Total noninterest income


18,140


17,737


16,525













Noninterest expense:









Compensation and employee benefits


31,000


28,047


28,920



Premises and occupancy costs


6,072


5,642


5,899



Office operations


3,892


3,419


3,508



Processing expenses


8,126


6,723


7,392



Marketing expenses


1,691


2,211


3,190



Federal deposit insurance premiums


1,177


1,242


1,286



Professional services


1,529


1,854


1,652



Amortization of intangible assets


422


330


269



Real estate owned expense


471


636


514



Acquisition expense


7,590


-


467



Other expense


1,834


3,250


2,038




Total noninterest expense


63,804


53,354


55,135















Income before income taxes


18,110


23,258


22,518



Income tax expense


5,238


5,926


7,213
















Net income


$                    12,872


17,332


15,305













Basic earnings per share


$                        0.14


0.19


0.17













Diluted earnings per share


$                        0.13


0.19


0.17













Annualized return on average equity


4.54%


6.43%


5.77%


Annualized return on average assets


0.59%


0.87%


0.78%













Basic common shares outstanding


95,256,807


91,745,512


91,538,172


Diluted common shares outstanding


95,825,798


92,118,154


91,998,005













 

Northwest Bancshares, Inc. and Subsidiaries


Consolidated Statements of Income


(Dollars in thousands, except per share amounts)
















Nine months ended 







September 30,







2015


2014


Interest income:







Loans receivable


$                            217,783


210,868



Mortgage-backed securities


6,522


7,963



Taxable investment securities


5,741


4,523



Tax-free investment securities


3,477


4,814



Interest-earning deposits


418


673




Total interest income


233,941


228,841











Interest expense:







Deposits


17,620


19,216



Borrowed funds


24,221


23,389




Total interest expense


41,841


42,605













Net interest income


192,100


186,236


Provision for loan losses


5,117


19,236




Net interest income after provision for loan losses


186,983


167,000











Noninterest income:







Gain on sale of investments


921


4,549



Service charges and fees


27,832


27,115



Trust and other financial services income


8,932


9,078



Insurance commission income


7,036


6,579



Loss on real estate owned, net


(1,833)


(937)



Income from bank owned life insurance


3,087


3,134



Mortgage banking income


725


753



Other operating income


2,590


3,274




Total noninterest income


49,290


53,545











Noninterest expense:







Compensation and employee benefits


87,815


84,562



Premises and occupancy costs


18,238


17,939



Office operations


11,080


11,044



Processing expenses


22,723


19,951



Marketing expenses


6,857


6,779



Federal deposit insurance premiums


3,810


3,877



Professional services


4,973


5,691



Amortization of intangible assets


959


992



Real estate owned expense


1,677


1,734



Acquisition expense


8,404


-



Other expense


6,114


7,754




Total noninterest expense


172,650


160,323













Income before income taxes


63,623


60,222



Income tax expense


19,276


15,605














Net income


$                               44,347


44,617











Basic earnings per share


$                                   0.48


0.49











Diluted earnings per share


$                                   0.48


0.48











Annualized return on average equity


5.47%


5.44%


Annualized return on average assets


0.73%


0.75%











Basic common shares outstanding


92,822,720


91,465,986


Diluted common shares outstanding


93,256,099


92,333,110











 

Northwest Bancshares, Inc. and Subsidiaries



Reconciliation of Non-GAAP to GAAP Net Income  *



(Dollars in thousands, except per share amounts)




























Quarter ended


Nine months ended











September 30,


September 30,











2015


2014


2015


2014



Operating results (non-GAAP):












Net interest income

$

66,941


62,341


192,100


186,236




Provision for loan losses


3,167


3,466


5,117


19,236




Noninterest income


18,140


17,737


49,290


53,545




Noninterest expense


56,214


53,354


164,246


160,323




Income taxes


7,844


5,926


22,128


15,605





Net operating income (non-GAAP)

$

17,856


17,332


49,899


44,617























Diluted earnings per share (non-GAAP)

$

0.19


0.19


0.54


0.49




















Reconciliation of net operating income to net income:












Net operating income (non-GAAP)

$

17,856


17,332


49,899


44,617



Nonoperating expenses, net of tax:












Acquisition expenses


(4,984)


-


(5,552)


-





Net income (GAAP)

$

12,872


17,332


44,347


44,617























Diluted earnings per share (GAAP)

$

0.13


0.19


0.48


0.48




















*-

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 net of tax benefit. The Company believe 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


(Dollars in thousands)
















September 30,
2015


June 30,
2015


September 30,
2014


December 31,
2014













Nonaccrual loans current:











Residential mortgage loans


$                1,900


$                1,655


1,645


1,169



Home equity loans


1,471


1,345


1,542


1,527



Other consumer loans


251


171


108


88



Commercial real estate loans


19,602


8,596


24,193


25,657



Commercial loans


4,877


5,096


9,775


3,963


Total nonaccrual loans current


$             28,101


$             16,863


37,263


32,404













Nonaccrual loans delinquent 30 days to 59 days:











Residential mortgage loans


$                            -


$                            -


27


1,545



Home equity loans


392


49


355


712



Other consumer loans


155


77


149


48



Commercial real estate loans


359


867


2,059


1,128



Commercial loans


131


186


485


9


Total nonaccrual loans delinquent 30 days to 59 days


$                1,037


$                1,179


3,075


3,442













Nonaccrual loans delinquent 60 days to 89 days:











Residential mortgage loans


$                1,097


$                1,197


782


784



Home equity loans


260


472


585


724



Other consumer loans


156


191


52


234



Commercial real estate loans


416


504


1,476


763



Commercial loans


11


119


660


131


Total nonaccrual loans delinquent 60 days to 89 days


$                1,940


$                2,483


3,555


2,636













Nonaccrual loans delinquent 90 days or more:











Residential mortgage loans


$             16,510


$             16,125


20,319


17,696



Home equity loans


4,546


4,616


6,802


6,606



Other consumer loans


3,132


2,199


2,098


2,450



Commercial real estate loans


10,565


12,673


13,552


11,099



Commercial loans


2,074


1,858


3,162


3,475


Total nonaccrual loans delinquent 90 days or more


$             36,827


$             37,471


45,933


41,326













Total nonaccrual loans


$             67,905


$             57,996


89,826


79,808



























September 30,


June 30,


September 30,


December 31,





2015


2015


2014


2014













Nonaccrual loans


$             67,905


$             57,996


89,826


79,808


Loans 90 days past maturity and still accruing


680


385


390


235


   Nonperforming loans


68,585


58,381


90,216


80,043


Real estate owned, net


10,391


13,864


15,007


16,759


   Nonperforming assets


$             78,976


$             72,245


105,223


96,802













Nonaccrual troubled debt restructuring *


$             23,184


$             15,443


21,871


24,459


Accruing troubled debt restructuring


26,154


40,741


39,995


37,329


Total troubled debt restructuring


$             49,338


$             56,184


61,866


61,788













Nonperforming loans to total loans


0.96%


0.95%


1.51%


1.34%













Nonperforming assets to total assets


0.88%


0.92%


1.34%


1.25%













Allowance for loan losses to total loans


0.85%


0.96%


1.20%


1.13%













Allowance for loan losses to nonperforming loans


94.54%


101.16%


79.42%


84.35%













* Amounts included in nonperforming loans above.










 

Northwest Bancshares, Inc. and Subsidiaries


Loans by credit quality indicators as of September 30, 2015


(Dollars in thousands)
































Recorded
















investment








Special








in loans






Pass


mention *


Substandard **


 Doubtful 


 Loss 


receivable


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




Other consumer loans


492,023


-


2,691


-


-


494,714



Total Personal Banking


4,390,472


-


18,614


-


1,355


4,410,441


















Business 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 Business Banking


2,507,805


52,703


180,499


165


-


2,741,172






















$         6,898,277


52,703


199,113


165


1,355


7,151,613


* - Includes $533,000 of acquired loans.














** - Includes $18.5 million of acquired loans.














































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


Delinquency


(Dollars in thousands)






































Loan delinquency schedule


















(Number of loans and dollar amount of loans)

















September 30,



June 30,



September 30,



December 31,





2015

*


2015

*


2014

*


2014

*


Loans delinquent 30 days to 59 days:


















Residential mortgage loans

75

$         3,644

0.1%


64

$         3,250

0.1%


79

$         4,241

0.2%


377

$      27,443

1.1%



Home equity loans

149

5,770

0.5%


112

3,768

0.4%


151

5,856

0.5%


161

5,752

0.5%



Consumer loans

1,214

6,324

1.3%


1,103

5,116

2.0%


1,105

5,076

2.1%


1,193

5,572

2.3%



Commercial real estate loans

55

7,463

0.3%


39

3,788

0.2%


69

5,888

0.3%


56

4,956

0.3%



Commercial loans

21

1,379

0.3%


21

1,363

0.4%


22

1,413

0.4%


26

2,262

0.6%


Total loans delinquent 30 days to 59 days

1,514

$      24,580

0.3%


1,339

$      17,285

0.3%


1,426

$      22,474

0.4%


1,813

$      45,985

0.8%




















Loans delinquent 60 days to 89 days:


















Residential mortgage loans

83

$         5,193

0.2%


70

$         5,815

0.2%


87

$         6,558

0.3%


100

$         6,970

0.3%



Home equity loans

52

1,716

0.1%


39

2,090

0.2%


54

1,727

0.2%


49

1,672

0.2%



Consumer loans

512

2,593

0.5%


442

1,767

0.7%


467

1,958

0.8%


525

2,435

1.0%



Commercial real estate loans

28

8,368

0.4%


30

4,919

0.3%


31

2,762

0.2%


21

2,038

0.1%



Commercial loans

8

401

0.1%


7

159

0.0%


13

970

0.2%


4

209

0.1%


Total loans delinquent 60 days to 89 days

683

$      18,271

0.3%


588

$      14,750

0.2%


652

$      13,975

0.2%


699

$      13,324

0.2%




















Loans delinquent 90 days or more: **


















Residential mortgage loans

204

$      17,209

0.6%


203

$      16,125

0.6%


251

$      20,319

0.8%


225

$      17,696

0.7%



Home equity loans

136

5,554

0.5%


104

4,616

0.4%


159

6,802

0.6%


139

6,606

0.6%



Consumer loans

570

3,156

0.6%


440

2,199

0.9%


465

2,098

0.9%


539

2,450

1.0%



Commercial real estate loans

95

14,898

0.6%


76

12,673

0.7%


110

13,552

0.8%


102

11,099

0.6%



Commercial loans

23

2,319

0.6%


13

1,858

0.5%


25

3,162

0.8%


25

3,475

1.0%


Total loans delinquent 90 days or more

1,028

$      43,136

0.6%


836

$      37,471

0.6%


1,010

$      45,933

0.8%


1,030

$      41,326

0.7%




















Total loans delinquent

3,225

$      85,987

1.2%


2,763

$      69,506

1.1%


3,088

$      82,382

1.4%


3,542

$   100,635

1.7%




















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










** - Includes $6.3 million of acquired loans considered to be accruing. At September 30, 2015, we expect to fully collect the carrying value of our acquired loans and have 


determined that we can reasonably estimate their future cash flows including those loans that are 90 days or more delinquent.  As a result, we do not consider our 



acquired loans that are 90 days or more delinquent to be nonaccrual or impaired and continue to recognize interest income on these loans including the loans' 



accretable discount.

















 

Northwest Bancshares, Inc. and Subsidiaries


Allowance for loan losses


(Dollars in thousands)
















Quarter ended


Nine months ended





September 30,


September 30,





2015


2014


2015


2014


Allowance for loan losses 











Beginning balance


$             59,057


71,442


67,518


71,348



Provision


3,167


3,466


5,117


19,236



Charge-offs residential mortgage


(342)


(352)


(955)


(1,694)



Charge-offs home equity


(443)


(325)


(1,327)


(1,290)



Charge-offs other consumer


(2,014)


(1,446)


(5,713)


(4,612)



Charge-offs commercial real estate


(558)


(2,199)


(5,110)


(5,709)



Charge-offs commercial


(595)


(360)


(7,675)


(10,646)



Recoveries


2,275


1,424


8,692


5,017



Ending balance


$             60,547


71,650


60,547


71,650
























Net charge-offs to average loans, annualized


0.10%


0.22%


0.26%


0.43%













 

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 September 30, 


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)

$  6,584,664

76,583

4.66%

$  5,912,890

71,306

4.78%

   Mortgage-backed securities (c) 

498,757

2,230

1.79%

569,482

2,504

1.76%

   Investment securities (c) (d) 

482,666

2,754

2.28%

488,893

3,405

2.79%

   FHLB stock 

39,552

451

4.52%

43,986

452

4.11%

   Other interest-earning deposits

162,041

99

0.24%

323,447

187

0.23%








Total interest-earning assets 

7,767,680

82,117

4.24%

7,338,698

77,854

4.24%








Noninterest earning assets (e)

846,439



537,065










Total assets

$  8,614,119



$  7,875,763










Liabilities and shareholders' equity:







Interest-bearing liabilities:







   Savings deposits

$  1,324,620

865

0.26%

$  1,228,105

834

0.27%

   Interest-bearing demand deposits

1,022,585

149

0.06%

899,231

152

0.07%

   Money market deposit accounts

1,217,122

825

0.27%

1,187,024

802

0.27%

   Time deposits

1,577,159

4,324

1.09%

1,553,867

4,517

1.15%

   Borrowed funds (f)

906,410

6,713

2.94%

876,034

6,700

3.03%

   Junior subordinated debentures

111,213

1,274

4.48%

103,094

1,182

4.49%








Total interest-bearing liabilities

6,159,109

14,150

0.91%

5,847,355

14,187

0.96%








Noninterest-bearing demand deposits

1,054,270



891,842



Noninterest bearing liabilities

275,435



66,432










Total liabilities

7,488,814



6,805,629










Shareholders' equity

1,125,305



1,070,134










Total liabilities and shareholders' equity

$  8,614,119



$  7,875,763










Net interest income/ Interest rate spread


67,967

3.33%


63,667

3.28%








Net interest-earning assets/ Net interest margin

$  1,608,571


3.50%

$  1,491,343


3.47%








Ratio of interest-earning assets to







 interest-bearing liabilities

 1.26X 



 1.26X 










(a) Average gross loans receivable includes loans held as available-for-sale and loans placed on nonaccrual status, and adjustments for acquired loans.

(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 - 4.63% and 4.75%, respectively, Investment securities - 1.84% 

       and 2.10%, respectively, Interest-earning assets - 4.19% and 4.17%, respectively. GAAP basis net interest rate spreads were 3.28% and 

      3.21%, respectively, and GAAP basis net interest margins were 3.45% and 3.40%, respectively.

 

Northwest Bancshares, Inc. and Subsidiaries

Average balance sheet 

(Dollars in thousands)








The following table sets forth certain information relating to the Company's average balance sheet and reflects the average yield on assets and

average cost of liabilities for the periods indicated.  Such yields and costs are derived by dividing income or expense by the average balance of

assets or liabilities, respectively, for the periods presented.  Average balances are calculated using daily averages.










 Nine months ended September 30, 


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)

$  6,228,049

219,210

4.71%

$  5,856,940

212,437

4.85%

   Mortgage-backed securities (c) 

494,416

6,522

1.76%

597,042

7,963

1.78%

   Investment securities (c) (d) 

483,792

8,761

2.41%

501,120

10,504

2.79%

   FHLB stock (h)

37,112

1,289

4.64%

43,882

1,425

4.33%

   Other interest-earning deposits

217,232

418

0.25%

352,370

673

0.25%








Total interest-earning assets 

7,460,601

236,200

4.23%

7,351,354

233,002

4.23%








Noninterest earning assets (e)

664,830



563,902










Total assets

$  8,125,431



$  7,915,256










Liabilities and shareholders' equity:







Interest-bearing liabilities:







   Savings deposits

$  1,273,724

2,516

0.26%

$  1,225,411

2,459

0.27%

   Interest-bearing demand deposits

1,025,896

411

0.06%

882,465

440

0.07%

   Money market deposit accounts

1,176,446

2,349

0.27%

1,181,056

2,376

0.27%

   Time deposits

1,395,165

12,344

1.11%

1,598,870

13,941

1.17%

   Borrowed funds (f)

932,123

20,617

2.96%

876,606

19,880

3.03%

   Junior subordinated debentures

105,800

3,604

4.49%

103,094

3,509

4.49%








Total interest-bearing liabilities

5,909,154

41,841

0.95%

5,867,502

42,605

0.97%








Noninterest-bearing demand deposits

975,904



853,294



Noninterest bearing liabilities

156,247



98,877










Total liabilities

7,041,305



6,819,673










Shareholders' equity

1,084,126



1,095,583










Total liabilities and shareholders' equity

$  8,125,431



$  7,915,256










Net interest income/ Interest rate spread


194,359

3.28%


190,397

3.26%








Net interest-earning assets/ Net interest margin

$  1,551,447


3.47%

$  1,483,852


3.45%








Ratio of interest-earning assets to







 interest-bearing liabilities

 1.26X 



 1.25X 










(a) Average gross loans receivable includes loans held as available-for-sale and loans placed on nonaccrual status, and adjustments for acquired loans.

(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 - 4.68% and 4.81%, respectively, Investment securities - 1.90% 

       and 2.11%, respectively, Interest-earning assets - 4.17% and 4.15%, respectively. GAAP basis net interest rate spreads were 3.22% and 

      3.18%, respectively, and GAAP basis net interest margins were 3.41% and 3.38%, respectively.

(h) Excludes a $1.0 million special dividend paid in February 2015 from the average yield calculation.

 

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 


September 30, 2015

June 30, 2015




 Avg. 



 Avg. 


Average 


 Yield/ 

 Average   


 Yield/ 


 Balance 

 Interest 

 Cost (g) 

Balance

 Interest 

 Cost (g) 

Assets:







Interest-earning assets:







   Loans receivable (a) (b) (d)

$  6,584,664

76,583

4.66%

$  6,073,911

71,445

4.72%

   Mortgage-backed securities (c) 

498,757

2,230

1.79%

477,800

2,058

1.72%

   Investment securities (c) (d) 

482,666

2,754

2.28%

482,670

2,887

2.39%

   FHLB stock 

39,552

451

4.52%

35,608

475

5.35%

   Other interest-earning deposits

162,041

99

0.24%

272,691

180

0.26%








Total interest-earning assets 

7,767,680

82,117

4.24%

7,342,680

77,045

4.21%








Noninterest earning assets (e)

846,439



529,528










Total assets

$  8,614,119



$  7,872,208










Liabilities and shareholders' equity:







Interest-bearing liabilities:







   Savings deposits

$  1,324,620

865

0.26%

$  1,263,785

838

0.27%

   Interest-bearing demand deposits

1,022,585

149

0.06%

920,071

131

0.06%

   Money market deposit accounts

1,217,122

825

0.27%

1,147,017

759

0.27%

   Time deposits

1,577,159

4,324

1.09%

1,409,740

3,963

1.13%

   Borrowed funds (f)

906,410

6,713

2.94%

929,744

6,929

2.99%

   Junior subordinated debentures

111,213

1,274

4.48%

103,094

1,172

4.50%








Total interest-bearing liabilities

6,159,109

14,150

0.91%

5,773,451

13,792

0.96%








Noninterest-bearing demand deposits

1,054,270



957,912



Noninterest bearing liabilities

275,435



77,075










Total liabilities

7,488,814



6,808,438










Shareholders' equity

1,125,305



1,063,770










Total liabilities and shareholders' equity

$  8,614,119



$  7,872,208










Net interest income/ Interest rate spread


67,967

3.33%


63,253

3.25%








Net interest-earning assets/ Net interest margin

$  1,608,571


3.50%

$  1,569,229


3.45%








Ratio of interest-earning assets to







 interest-bearing liabilities

 1.26X 



 1.27X 










(a) Average gross loans receivable includes loans held as available-for-sale and loans placed on nonaccrual status, and adjustments for acquired loans.

(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 - 4.63% and 4.69%, respectively, Investment securities -1.84% 

       and 1.88%, respectively, Interest-earning assets - 4.19% and 4.15%, respectively. GAAP basis net interest rate spreads were 3.28% and 

      3.19%, respectively, and GAAP basis net interest margins were 3.45% and 3.39%, respectively.

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/northwest-bancshares-inc-announces-third-quarter-2015-earnings-and-quarterly-dividend-300166005.html

SOURCE Northwest Bancshares, Inc.



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