Northwest Bancshares, Inc. [NWBI] Filings

10-Q 1 nwbi-20220331.htm 10-Q nwbi-20220331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2022

☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission File Number 001-34582

NORTHWEST BANCSHARES, INC.

(Exact name of registrant as specified in its charter)

Maryland

27-0950358

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

3 Easton Oval

Suite 500

Columbus

Ohio

43219

(Address of Principal Executive Offices)

(Zip Code)

(814) 726-2140

(Registrant’s telephone number, including area code)

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading symbol(s)

Name of each exchange on which registered

Common Stock, 0.01 Par Value

NWBI

NASDAQ Stock Market, LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

☒ Large accelerated filer ☐ Accelerated filer

☐ Non-accelerated filer ☐ Smaller reporting company

☐ Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

Common Stock ($0.01 par value), 126,710,453 shares outstanding as of April 30, 2022.

Table of Contents

NORTHWEST BANCSHARES, INC.

Table of Contents

PART I

FINANCIAL INFORMATION

Item 1.

Financial Statements

Consolidated Statements of Financial Condition at March 31, 2022 and December 31, 2021 (Unaudited)

Consolidated Statements of Income for the quarter ended March 3 1 , 202 2 and 202 1 (Unaudited)

Consolidated Statements of Comprehensive Income for the quarter ended March 3 1 , 202 2 and 202 1 (Unaudited)

Consolidated Statements of Changes in Shareholders’ Equity for the quarter ended March 3 1 , 202 2 and 202 1 (Unaudited)

Consolidated Statements of Cash Flows for the quarter ended March 3 1 , 202 2 and 202 1 (Unaudited)

Notes to Consolidated Financial Statements (Unaudited)

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Item 4.

Controls and Procedures

Unregistered Sales of Equity Securities and Use of Proceeds

Item 3.

Defaults Upon Senior Securities

Item 4.

Mine Safety Disclosures

Item 1. FINANCIAL STATEMENTS

NORTHWEST BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited)

(in thousands, except share data)


	March 31, 2022		December 31, 2021
Assets
Cash and cash equivalents	$	1,161,006	1,279,259


Marketable securities available-for-sale (amortized cost of $1,542,170 and $1,565,002, respectively)	1,442,098		1,548,592
Marketable securities held-to-maturity (fair value of $677,376 and $751,513, respectively)	737,730		768,154
Total cash and cash equivalents and marketable securities	3,340,834		3,596,005


Loans held-for-sale	19,272		25,056








Loans held for investment	10,119,762		9,991,336

Allowance for credit losses	(99,295)		(102,241)
Loans receivable, net	10,039,739		9,914,151


FHLB stock, at cost	13,318		14,184
Accrued interest receivable	26,268		25,599
Real estate owned, net	929		873
Premises and equipment, net	149,970		156,524
Bank-owned life insurance	254,109		256,213
Goodwill	380,997		380,997
Other intangible assets, net	11,654		12,836
Other assets	193,365		144,126
Total assets	$	14,411,183	14,501,508

Liabilities and shareholders’ equity
Liabilities:
Noninterest-bearing demand deposits	$	3,128,849	3,099,526
Interest-bearing demand deposits	2,891,622		2,940,442
Money market deposit accounts	2,680,613		2,629,882
Savings deposits	2,367,438		2,303,760
Time deposits	1,251,878		1,327,555
Total deposits	12,320,400		12,301,165


Borrowed funds	121,436		139,093
Subordinated debt	123,670		123,575
Junior subordinated debentures	129,119		129,054
Advances by borrowers for taxes and insurance	44,022		44,582
Accrued interest payable	563		1,804
Other liabilities	148,461		178,664
Total liabilities	12,887,671		12,917,937

Shareholders’ equity:
Preferred stock, $0.01 par value: 50,000,000 authorized, no shares issued	—		—
Common stock, $0.01 par value: 500,000,000 shares authorized, 126,686,373 and 126,612,183 shares issued and outstanding, respectively	1,267		1,266
Additional paid-in capital	1,012,308		1,010,405
Retained earnings	612,481		609,529

Accumulated other comprehensive loss	(102,544)		(37,629)
Total shareholders’ equity	1,523,512		1,583,571
Total liabilities and shareholders’ equity	$	14,411,183	14,501,508

See accompanying notes to unaudited Consolidated Financial Statements.

Table of Contents

NORTHWEST BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(in thousands, except share data)


	Quarter ended March 31,
	2022		2021
Interest income:
Loans receivable	$	88,174	102,318
Mortgage-backed securities	6,360		4,200
Taxable investment securities	677		634
Tax-free investment securities	674		575
FHLB stock dividends	81		116
Interest-earning deposits	467		183
Total interest income	96,433		108,026
Interest expense:
Deposits	3,751		5,514
Borrowed funds	2,059		2,054
Total interest expense	5,810		7,568
Net interest income	90,623		100,458
Provision for credit losses	(1,481)		(5,620)
Net interest income after provision for credit losses	92,104		106,078
Noninterest income:
Loss on sale of investments	(2)		(21)

Service charges and fees	13,067		12,394


Trust and other financial services income	7,012		6,484
Insurance commission income	—		2,546
Loss on real estate owned, net	(29)		(42)
Income from bank-owned life insurance	1,983		1,736
Mortgage banking income	1,465		6,020

Other operating income	2,244		2,836
Total noninterest income	25,740		31,953
Noninterest expense:
Compensation and employee benefits	46,917		47,239
Premises and occupancy costs	7,797		8,814
Office operations	3,383		3,165
Collections expense	520		616
Processing expenses	12,548		13,456
Marketing expenses	2,128		1,980
Federal deposit insurance premiums	1,129		1,307
Professional services	2,573		4,582
Amortization of intangible assets	1,183		1,594
Real estate owned expense	37		75
Merger, asset disposition and restructuring expense	1,374		9

Other expenses	2,355		3,354
Total noninterest expense	81,944		86,191
Income before income taxes	35,900		51,840
Federal and state income taxes expense	7,613		11,603
Net income	$	28,287	40,237
Basic earnings per share	$	0.22	0.32
Diluted earnings per share	$	0.22	0.32

See accompanying notes to unaudited Consolidated Financial Statements.

Table of Contents

NORTHWEST BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

(in thousands)


	Quarter ended March 31,
	2022		2021
Net income	$	28,287	40,237
Other comprehensive income net of tax:
Net unrealized holding losses on marketable securities:
Unrealized holding losses, net of tax of $18,877 and $5,981, respectively	(64,783)		(17,421)
Reclassification adjustment for gains included in net income, net of tax of $0 and $22, respectively	(1)		(75)
Net unrealized holding losses on marketable securities	(64,784)		(17,496)






Defined benefit plan:
Actuarial reclassification adjustments for prior period service costs and actuarial (gains)/losses included in net income, net of tax of $50 and ($129), respectively	(131)		333



Other comprehensive loss	(64,915)		(17,163)

Total comprehensive (loss)/income	$	(36,628)	23,074

See accompanying notes to unaudited Consolidated Financial Statements.

Table of Contents

NORTHWEST BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)

(in thousands, expect share data)


				Additional paid-in capital	Retained earnings	Accumulated other comprehensive loss	Total shareholders’ equity
	Common stock
Quarter ended March 31, 2022	Shares	Amount
Beginning balance at December 31, 2021	126,612,183	$	1,266	1,010,405	609,529	(37,629)	1,583,571



Comprehensive income:
Net income	—	—		—	28,287	—	28,287

Other comprehensive loss, net of tax of $18,927	—	—		—	—	(64,915)	(64,915)

Total comprehensive income/(loss)	—	—		—	28,287	(64,915)	(36,628)





Exercise of stock options	101,613	1		1,204	—	—	1,205

Stock-based compensation expense	10,222	—		699	—	—	699





Stock-based compensation forfeited	(37,645)	—		—	—	—	—



Dividends paid ($0.20 per share)	—	—		—	(25,335)	—	(25,335)

Ending balance at March 31, 2022	126,686,373	$	1,267	1,012,308	612,481	(102,544)	1,523,512


				Additional paid-in capital	Retained earnings	Accumulated other comprehensive income/(loss)	Total shareholders’ equity
	Common stock
Quarter ended March 31, 2021	Shares	Amount
Beginning balance at December 31, 2020	127,019,452	$	1,270	1,015,502	555,480	(33,549)	1,538,703

Comprehensive income:
Net income	—	—		—	40,237	—	40,237

Other comprehensive loss, net of tax of $5,874	—	—		—	—	(17,163)	(17,163)

Total comprehensive income/(loss)	—	—		—	40,237	(17,163)	23,074





Exercise of stock options	567,429	6		6,921	—	—	6,927

Stock-based compensation expense	1,930	—		961	—	—	961

Share repurchases	(353,552)	(4)		(4,562)	—	—	(4,566)

Stock-based compensation forfeited	(12,611)	—		—	—	—	—



Dividends paid ($0.19 per share)	—	—		—	(24,105)	—	(24,105)

Ending balance at March 31, 2021	127,222,648	$	1,272	1,018,822	571,612	(50,712)	1,540,994

See accompanying notes to unaudited Consolidated Financial Statements.

Table of Contents

NORTHWEST BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in thousands)


	Quarter ended March 31,
	2022		2021
Operating activities:
Net income	$	28,287	40,237
Adjustments to reconcile net income to net cash provided by/(used in) operating activities:
Provision for credit losses	(1,481)		(5,620)
Net loss/(gain) on sale of assets	780		(262)
Mortgage banking activity	677		(8,429)


Net depreciation, amortization and accretion	3,595		6,514
(Increase)/decrease in other assets	(30,666)		33,746
Decrease in other liabilities	(31,625)		(21,034)
Net amortization on marketable securities	1,505		2,154
Noncash compensation expense related to stock benefit plans	699		961
Noncash write-down of real estate owned	29		123




Origination of loans held-for-sale	(104,535)		(240,765)
Proceeds from sale of loans held-for-sale	110,278		260,394

Net cash (used in)/provided by operating activities	(22,457)		68,019

Investing activities:
Purchase of marketable securities held-to-maturity	—		(428,861)
Purchase of marketable securities available-for-sale	(61,640)		(220,666)
Proceeds from maturities and principal reductions of marketable securities held-to-maturity	30,092		3,374
Proceeds from maturities and principal reductions of marketable securities available-for-sale	83,295		128,556
Proceeds from sale of marketable securities available-for-sale	—		35,357
Proceeds from bank-owned life insurance	1,354		1,750
Loan originations	(901,499)		(975,141)
Loan purchases	(210,775)		—
Proceeds from loan maturities and principal reductions	985,218		1,169,026

Net proceeds/(redemptions) of FHLB stock	866		(113)
Proceeds from sale of real estate owned	—		479
Proceeds from sale of real estate owned for investment, net	76		76
Disposals/(purchases) of premises and equipment, net	329		(285)


Net cash used in investing activities	(72,684)		(286,448)

Table of Contents

NORTHWEST BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (continued)

(in thousands)


	Three months ended March 31,
	2022		2021
Financing activities:
Net increase in deposits	$	19,235	513,861

Repayments of long-term borrowings	—		(20,000)
Net decrease in short-term borrowings	(17,657)		(9,469)
Decrease in advances by borrowers for taxes and insurance	(560)		(1,206)
Cash dividends paid on common stock	(25,335)		(24,105)
Purchase of common stock for retirement	—		(4,566)
Proceeds from stock options exercised	1,205		6,927

Net cash (used in)/provided by financing activities	(23,112)		461,442

Net (decrease)/increase in cash and cash equivalents	$	(118,253)	243,013

Cash and cash equivalents at beginning of period	$	1,279,259	736,277
Net (decrease)/increase in cash and cash equivalents	(118,253)		243,013
Cash and cash equivalents at end of period	$	1,161,006	979,290







Cash paid during the period for:
Interest on deposits and borrowings (including interest credited to deposit accounts of $3,650 and $5,543, respectively)	$	7,051	8,963
Income taxes	84		—







Non-cash activities:
Loan foreclosures and repossessions	$	1,142	1,197
Sale of real estate owned financed by the Company

Northwest Bancshares, Inc. [NWBI] Filings
10-Q	[2022-05-06]
10-K	[2022-02-25]
10-Q	[2021-11-04]
10-Q	[2021-08-05]
10-Q	[2021-05-06]
10-K	[2021-02-26]
10-Q	[2020-11-06]
10-Q	[2020-08-07]
10-Q	[2020-05-11]
10-K	[2020-03-02]
10-Q	[2019-11-08]
10-Q	[2019-08-08]
10-Q	[2019-05-09]
10-K	[2019-03-01]
10-Q	[2018-11-08]
10-Q	[2018-08-08]
10-Q	[2018-05-10]
10-K	[2018-03-01]
10-Q	[2017-11-09]
10-Q	[2017-08-09]
10-Q	[2017-05-10]
10-K	[2017-03-01]
10-Q	[2016-11-09]
10-Q	[2016-08-09]
10-Q	[2016-05-10]
10-K	[2016-02-29]
10-Q	[2015-11-09]
10-Q	[2015-08-10]
10-Q	[2015-05-11]
10-K	[2015-02-27]
10-Q	[2014-11-07]
10-Q	[2014-08-08]
10-Q	[2014-05-09]
10-K	[2014-02-28]
10-Q	[2013-11-08]
10-Q	[2013-08-09]
10-Q	[2013-05-10]
10-K	[2013-03-01]
10-Q	[2012-11-05]
10-Q	[2012-08-03]
10-Q	[2012-05-08]
10-K	[2012-02-29]