Northwest’s Quarterly Net Income Declines | News, Sports, Jobs

0


[ad_1]

Northwest Bancshares Inc. reported net income for the quarter ended September 30, 2021, of $ 35.1 million, or 27 cents per diluted share.

Net income decreased $ 3 million, or 7.9%, from the same quarter in 2020, when net income was $ 38.1 million, or 30 cents per diluted share. The annualized returns on average equity and average assets for the quarter ended September 30, 2021 were 8.86% and 0.97%, compared to 9.82% and 1.09% for the same quarter a year latest.

The company also announced that its board of directors declared a quarterly cash dividend of 20 cents per share payable on November 15, 2021 to shareholders of record on November 5, 2021. This is the 108th consecutive quarter in which the company has paid a cash dividend. Based on the market value of the company’s common shares as of September 30, 2021, this represents an annualized dividend yield of approximately 6%.

“We were pleased to see that in the absence of approximately $ 125.0 million in PPP loan cancellations / repayments this quarter, outstanding loans increased by approximately $ 14.0 million, or 0.14%. In addition, $ 17.2 million of classified loans refinanced by the bank which contributed to the decrease of $ 30.3 million in non-performing assets while our defaults remain very low. As a result of these credit improvements, we have continued to release credit loss reserves that were built up last year during COVID-19 ”, said Ronald J. Seiffert, president of the bank, president and chief executive officer. “While challenges continue with net interest income due to the low interest rate environment and declining yields, interest income in the current quarter has been increased by 4.0 million dollars increase in PPP fees. In addition, non-interest income stabilized in the last quarter, having absorbed about $ 1 million less per month in interchange income since August of last year due to the negative impact of the Durbin Amendment for all institutions with more than $ 10.0 billion in assets. Finally, non-interest base charges have remained stable over the past five quarters due to our continued focus on expense control. “

Net interest income decreased $ 5.1 million, or 4.9%, to $ 98.4 million for the quarter ended September 30, 2021, from $ 103.5 million. dollars for the quarter ended September 30, 2020, largely due to a decrease of $ 9.8 million, or 9.1% in interest income on loans receivable. This decrease in interest income on loans is attributable to a decrease of $ 551.4 million, or 5.1%, in the average loan balance. $ 580.0 million in PPP loan remittances / repayments since September 30 of last year contributed to this decrease in average balances. A decrease in the average loan yield to 3.80% for the quarter ended September 30, 2021 from 3.98% for the quarter ended September 30, 2020 also contributed to the decline in interest income. This decrease in interest income was partially offset by a decrease of $ 3.9 million, or 46.2%, in interest expense on deposits due to lower market interest rates compared to the previous year, which resulted in a decrease in the cost of our liabilities bearing interest to 0.27% for the quarter ended September 30, 2021 compared to 0.42% for the quarter ended September 30, 2020. The effect net of changes in interest rates and average balances was a decrease in the net interest margin to 2.97% for the quarter ended September 30, 2021 from 3.26% for the same quarter per year latest. .

The allowance for credit losses decreased by $ 11.2 million for a current period credit of $ 4.4 million for the quarter ended September 30, 2021 compared to an allowance charge of $ 6.8 million. dollars for the quarter ended September 30, 2020 due to a reversal of the allowance for credit losses as economic forecasts continue to improve and classified assets decline. Total classified loans decreased $ 73.4 million, or 16.0%, to $ 384.4 million, or 3.77% of total loans, as of September 30, 2021, from 457 , $ 8 million, or 4.25% of total loans, as of September 30, 2020.

See QUARTER, page C3

Trimester

From page C1

Non-interest income decreased $ 7.5 million, or 20.4%, to $ 29.2 million for the quarter ended September 30, 2021, from $ 36.7 million for the quarter ended September 30, 2020. This decrease is mainly due to a decrease in mortgage banking income of $ 7.1 million. , or 64.4%, to $ 3.9 million for the quarter ended September 30, 2021 compared to $ 11.1 million for the quarter ended September 30, 2020. This decrease reflects the impact of less favorable prices on the market. secondary market. In addition, there was a decrease in insurance commission income of $ 2.3 million, or 98.1%, to $ 44,000 for the quarter ended September 30, 2021 from $ 2.3 million. dollars for the quarter ended September 30, 2020 due to the sale of the insurance business in the second quarter of 2021. Finally, service charges and fees decreased by $ 1.2 million, or 8, 0%, to $ 13.2 million for the quarter ended September 30, 2021, compared to $ 14.4 million for the quarter ended September 30, 2020 primarily due to the impact of the Durbin Amendment on trading income. This decrease was partially offset by an increase in trust and other financial services revenues of $ 1.8 million, or 33.6%, to $ 7.2 million for the quarter ended September 30, 2021 by compared to $ 5.4 million for the quarter ended September 30, 2020, due to increases in trust and brokerage advisory services. In addition, there was an increase in other operating income of $ 1.3 million, or 62.6%, to $ 3.3 million for the quarter ended September 30, 2021, from 2. $ 0 million for the quarter ended September 30, 2020, primarily due to commissions collected on debit / Incentives based on credit card volume.

Non-interest expense decreased $ 767,000, or 0.9%, to $ 86.1 million for the quarter ended September 30, 2021, from $ 86.9 million for the quarter ended September 30 2020. This decrease is due to a decrease in the majority of the non-interest expense categories. Processing fees decreased $ 1.5 million, or 10.1%, to $ 13.5 million for the quarter ended September 30, 2021, from $ 15.0 million for the quarter ended September 30 2020. Merger-related costs decreased $ 1.4 million, or 100.0%, due to expenses incurred in the prior year following the acquisition of MutualFirst Financial, Inc. These decreases were partially offset by a $ 1.7 million, or 3.6%, increase in compensation and benefits primarily due to increased costs for Medicare and other benefits, regular increases in merit spending and the addition of strategic staff. In addition, there was an increase in other expenses of $ 2.2 million for the quarter ended September 30, 2021, primarily due to an increase in the unfunded reserve due to an increase in unused commitments. in commercial real estate and construction portfolios.

The provision for income taxes increased $ 2.3 million, or 27.5%, to $ 10.8 million for the quarter ended September 30, 2021, from $ 8.5 million. dollars for the quarter ended September 30, 2020. This increase in income taxes is attributable to an increase in the effective tax rate for 2021, as the previous year had a higher percentage of net income generated by non-earning assets. taxable or fiscally advantageous.

Northwest Bancshares, Inc. is the holding company of Northwest Bank, headquartered in Warren, Pennsylvania.

The latest news today and more in your inbox

[ad_2]

Share.

About Author

Leave A Reply