PR Newswire | Jan 25, 2021 09:01AM EST

Dividend

01/25 08:00 CST

Northwest Bancshares, Inc. Announces Fourth Quarter 2020 Earnings and Quarterly Dividend WARREN, Pa., Jan. 25, 2021

WARREN, Pa., Jan. 25, 2021 /PRNewswire/ -- Northwest Bancshares, Inc., (the "Company"), (NasdaqGS: NWBI) announced net income for the quarter ended December 31, 2020 of $35.1 million, or $0.28 per diluted share. This represents an increase of $9.5 million, or 37.0%, compared to the same quarter last year when net income was $25.6 million, or $0.24 per diluted share. The annualized returns on average shareholders' equity and average assets for the quarter ended December 31, 2020 were 9.00% and 1.01% compared to 7.52% and 0.97% for the same quarter last year.

The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.19 per share payable on February 15, 2021 to shareholders of record as of February 4, 2021. This is the 105th consecutive quarter in which the Company has paid a cash dividend. Ronald J. Seiffert, Chairman, President and CEO, added, "We are extremely proud that we were able to maintain our dividend throughout 2020 despite the challenges of COVID-19 on bank earnings. Based on the current market value of the Company's stock, this represents an annualized dividend yield of approximately 5.50%, which continues to be among the highest in our peer group."

Mr. Seiffert continued, "When looking back over a very challenging 2020, I am amazed at what our team accomplished during the midst of COVID-19. We successfully adopted CECL in the first quarter followed closely by the close and conversion of MutualBank on April 24th, the largest acquisition in the company's history. We also completed a very successful $125 million sub-debt offering in September. This additional liquidity and capital at the holding company allowed us to resume our existing five million share common stock buyback program, of which we successfully repurchased approximately 760,000 shares in the fourth quarter at an average price of $12.20. Finally, we completed our branch optimization program which resulted in the consolidation of 43 offices in December 2020. In addition to all of these initiatives, we will be launching our digital strategy this year which will significantly enhance our online banking capabilities and streamline our account opening processes. We want to give our customers the same award winning experience online as they are accustomed to receiving in our branch offices. In addition, we are expanding our capabilities in mortgage banking to all of our markets and expanding our geographic footprint for dealer services' indirect auto and power sports lending. We have acquired talent to enhance our treasury management services, added resources to our corporate finance capabilities, created a healthcare vertical with a dedicated subject matter expert and will be opening a Loan Production Office in the greater Philadelphia market with the addition of a team of capable middle market bankers. As rewarding as 2020 was, we are even more optimistic about 2021."

Net interest income increased by $13.9 million, or 15.7%, to $102.9 million for the quarter ended December 31, 2020, from $88.9 million for the quarter ended December 31, 2019, primarily due to a $7.8 million, or 8.0%, increase in interest income on loans receivable and a $6.2 million, or 47.9%, decrease in interest expense on deposits. The increase in interest income was primarily due to an increase of $1.935 billion, or 22.2%, in the average balance of loans which more than offset the decline experienced from a reduction in the yield on loans to 3.97% for the quarter ended December 31, 2020 from 4.47% for the same quarter last year. The decrease in interest expense was primarily due to a decrease in our interest-bearing cost of deposits to 0.30% for the quarter ended December 31, 2020 from 0.75% for the quarter ended December 31, 2019 which was partially offset by the growth in the average balance of interest-bearing deposits by $1.991 billion, or 29.1%. The net impact of these changes caused the Company's net interest margin to decrease to 3.26% for the quarter ended December 31, 2020 from 3.73% for the same quarter last year.

The provision for credit losses decreased by $10.5 million, or 127.1%, due to a release of the allowance for credit losses of $2.2 million for the quarter ended December 31, 2020, compared to an expense of $8.2 million for the quarter ended December 31, 2019. This decrease in the provision was primarily the result of improvements in the economic forecasts.

Noninterest income increased by $3.9 million, or 13.9%, to $32.1 million for the quarter ended December 31, 2020, from $28.2 million for the quarter ended December 31, 2019. This increase was primarily due to the increase in mortgage banking income of $5.6 million to $7.1 million for the quarter ended December 31, 2020 from $1.5 million for the quarter ended December 31, 2019. Our successful mortgage banking income was the result of continued efforts to expand our secondary market sales capabilities over the past year, as well as an interest rate environment conducive to refinance activity and attractive secondary market pricing. Also contributing to this increase was a $1.2 million, or 26.7%, increase in trust and other financial services income due to additional fee income received as a result of the acquisition of MutualBank. Partially offsetting these increases was a decrease in other operating income of $1.4 million, or 34.9%, due to a decline in swap fee income as well as a decrease of service charges and fees of $1.1 million, or 7.4%, primarily as a result of the fee income cap of the Durbin amendment on debit card interchange revenue which took effect for Northwest on July 1, 2020.

Noninterest expense increased by $16.3 million, or 21.3%, to $92.8 million for the quarter ended December 31, 2020, from $76.6 million for the quarter ended December 31, 2019. This increase primarily resulted from a $6.1 million increase in acquisition and branch optimization expense due to expenses incurred as part of the branch optimization initiative that occurred during December. In addition, compensation and employee benefits increased $6.1 million, or 14.6%, due to internal growth of compensation and staff as well as the addition of MutualBank employees. Also contributing to this increase was an increase in processing expenses of $1.9 million, or 18.7%, as we continue to invest in technology and infrastructure and as activity driven utilization fees for online and mobile banking and loan origination platforms has increased. Lastly, federal deposit insurance premiums increased $1.7 million due to assessment credits received in the previous year.

Net income for the year ended December 31, 2020 was $74.9 million, or $0.62 per diluted share. This represents a decrease of $35.6 million, or 32.2%, compared to the year ended December 31, 2019, when net income was $110.4 million, or $1.04 per diluted share. The annualized returns on average shareholders' equity and average assets for the year ended December 31, 2020 were 4.72% and 0.58% compared to 8.36% and 1.07% for the prior year. This decrease in net income was the result of an increase in provision for credit losses of $61.3 million primarily as a result of COVID-19 and the expected impact on the allowance for credit losses as well as the acquisition of MutualBank and the required provision associated with the adoption of ASU 2016-13, Current Expected Credit Losses ("CECL"). In addition, noninterest expense increased by $51.4 million, or 17.4%, primarily as a result of the additional operating expenses of MutualBank as well as the one-time costs associated with acquisitions and branch optimization costs which increased $16.6 million for the year. Partially offsetting these factors was an increase in net interest income over the prior year of $31.3 million, or 8.7% due to balance sheet growth during the year as well as a $32.9 million, or 33.1%, increase in fee income highlighted by a $27.6 million increase in mortgage banking income.

Headquartered in Warren, Pennsylvania, Northwest Bancshares, Inc. is the holding company of Northwest Bank. Founded in 1896, Northwest Bank is a full-service financial institution offering a complete line of business and personal banking products, employee benefits and wealth management services, as well as the fulfillment of business and personal insurance needs. As of December 31, 2020, Northwest operates 162 full-service community banking offices and eight free standing drive-through facilities in Pennsylvania, New York, Ohio and Indiana. Northwest Bancshares, Inc.'s common stock is listed on the NASDAQ Global Select Market ("NWBI"). Additional information regarding Northwest Bancshares, Inc. and Northwest Bank can be accessed on-line at www.northwest.com.

Forward-Looking Statements - This release may contain forward-looking statements with respect to the financial condition and results of operations of Northwest Bancshares, Inc. including, without limitations, statements relating to the earnings outlook of the Company. These forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements, include among others, the following possibilities: (1) changes in the interest rate environment; (2) competitive pressure among financial services companies; (3) general economic conditions including an increase in non-performing loans; (4) changes in legislation or regulatory requirements; (5) difficulties in continuing to improve operating efficiencies; (6) difficulties in the integration of acquired businesses or the ability to complete sales transactions; and (7) increased risk associated with commercial real-estate and business loans. Management has no obligation to revise or update these forward-looking statements to reflect events or circumstances that arise after the date of this release.

Northwest Bancshares, Inc. and Subsidiaries Consolidated Statements of Financial Condition (Unaudited) (dollars in thousands, except per share amounts)



December 31, September December 31, 2020 30, 2019 2020

Assets

Cash and cash equivalents $736,277 656,749 60,846

Marketable securities available-for-sale (amortized cost1,398,941 1,409,150 819,901 of $1,375,685, $1,385,835 and $815,495, respectively)

Marketable securities held-to-maturity (fair value of 178,887 15,333 18,036 $179,666, $16,168 and $18,223, respectively)

Total cash and cash equivalents 2,314,105 2,081,232 898,783 and marketable securities



Residential mortgage loans 58,786 25,140 7,709 held-for-sale

Residential mortgage loans 3,009,335 3,118,229 2,860,418

Home equity loans 1,467,736 1,484,365 1,342,918

Consumer loans 1,507,993 1,487,083 1,125,132

Commercial real estate loans 3,345,889 3,319,743 2,754,390

Commercial loans 1,191,110 1,347,292 718,107

Total loans receivable 10,580,849 10,781,852 8,808,674

Allowance for credit losses (134,427) (140,209) (57,941)

Loans receivable, net 10,446,422 10,641,643 8,750,733



Federal Home Loan Bank stock, at 21,748 23,171 14,740 cost

Accrued interest receivable 35,554 36,916 25,755

Real estate owned, net 2,232 2,575 950

Premises and equipment, net 161,538 166,919 147,409

Bank-owned life insurance 253,951 252,621 189,091

Goodwill 382,279 386,044 346,103

Other intangible assets, net 19,936 21,601 23,076

Other assets 168,503 176,083 97,268

Total assets $13,806,268 13,788,805 10,493,908

Liabilities and shareholders' equity

Liabilities

Noninterest-bearing demand $2,716,224 2,641,234 1,609,653 deposits

Interest-bearing demand deposits 2,755,950 2,663,878 1,944,108

Money market deposit accounts 2,437,539 2,396,567 1,863,998

Savings deposits 2,047,424 2,022,918 1,604,838

Time deposits 1,642,096 1,732,022 1,569,410

Total deposits 11,599,233 11,456,619 8,592,007



Borrowed funds 283,044 398,216 246,336

Junior subordinated debentures 128,794 128,729 121,800

Advances by borrowers for taxes 45,230 29,755 44,556 and insurance

Accrued interest payable 2,054 1,002 1,142

Other liabilities 209,210 227,253 134,782

Total liabilities 12,267,565 12,241,574 9,140,623

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, 127,019,452, 127,801,297, and 1,270 1,278 1,069 106,859,088 shares issued and outstanding, respectively

Paid-in capital 1,015,502 1,023,827 805,750

Retained earnings 555,480 544,695 583,407

Accumulated other comprehensive (33,549) (22,569) (36,941) loss

Total shareholders' equity 1,538,703 1,547,231 1,353,285

Total liabilities and $13,806,268 13,788,805 10,493,908 shareholders' equity



Equity to assets 11.14 %11.22 %12.90 %

Tangible common equity to assets 8.48 %8.52 %9.72 %

Book value per share $12.11 12.11 12.66

Tangible book value per share $8.95 8.92 9.21

Closing market price per share $12.74 9.20 16.63

Full time equivalent employees 2,421 2,523 2,209

Number of banking offices 170 213 181

Northwest Bancshares, Inc. and Subsidiaries Consolidated Statements of Income/(Loss) (Unaudited) (dollars in thousands, except per share amounts)



Quarter ended

December 31, September 30,June 30, March 31, December 31, 2020 2020 2020 2020 2019

Interest income:

Loans receivable$105,681 107,241 103,012 94,973 97,866

Mortgage-backed 4,551 4,652 4,038 4,175 4,237 securities

Taxable investment 471 427 439 648 683 securities

Tax-free investment 656 655 564 185 201 securities

FHLB dividends 192 218 309 262 262

Interest-earning178 221 185 135 169 deposits

Total interest 111,729 113,414 108,547 100,378 103,418 income

Interest expense:

Deposits 6,714 8,443 9,336 11,403 12,893

Borrowed funds 2,127 1,437 1,133 1,747 1,580

Total interest 8,841 9,880 10,469 13,150 14,473 expense

Net interest 102,888 103,534 98,078 87,228 88,945 income

Provision for(2,230) 6,818 51,750 27,637 8,223 credit losses

Net interest income after 105,118 96,716 46,328 59,591 80,722 provision for credit losses

Noninterest income:

Gain/(loss) on sale of 75 (12) (8) 181 27 investments

Gain on sale of - - - 1,302 908 loans

Service charges 13,074 14,354 13,069 15,116 14,125 and fees

Trust and other financial 5,722 5,376 4,823 5,001 4,517 services income

Insurance commission 2,034 2,331 2,395 2,372 1,858 income

Gain/(loss) on real estate 114 (32) (97) (91) 86 owned, net

Income from bank-owned life 1,330 1,576 1,248 1,036 1,121 insurance

Mortgage banking7,120 11,055 12,022 1,194 1,494 income

Other operating 2,654 2,022 2,044 1,865 4,077 income

Total noninterest 32,123 36,670 35,496 27,976 28,213 income

Noninterest expense:

Compensation and employee 48,209 47,371 40,049 42,746 42,074 benefits

Premises and 7,614 8,342 7,195 7,471 7,051 occupancy costs

Office 4,009 4,626 3,711 3,382 4,097 operations

Collections 893 1,264 644 474 566 expense

Processing 12,186 15,042 11,680 11,142 10,263 expenses

Marketing 1,994 2,147 2,047 1,507 1,010 expenses

Federal deposit insurance 1,651 1,498 1,618 - - premiums

Professional 3,599 3,246 2,825 2,812 3,533 services

Amortization of intangible 1,664 1,781 1,760 1,651 1,634 assets

Real estate 64 111 89 95 72 owned expense

Acquisition/ branch 7,238 1,414 9,679 2,458 1,114 optimization expense

Other expenses 3,728 27 7,866 4,873 5,157

Total noninterest 92,849 86,869 89,163 78,611 76,571 expense

Income/(loss) before income 44,392 46,517 (7,339) 8,956 32,364 taxes

Income tax expense/ 9,327 8,467 (1,139) 1,017 6,773 (benefit)

Net income/ $35,065 38,050 (6,200) 7,939 25,591 (loss)



Basic earnings/ $0.28 0.30 (0.05) 0.08 0.24 (loss) per share

Diluted earnings /(loss) per $0.28 0.30 (0.05) 0.07 0.24 share



Weighted average common shares 126,713,429 126,855,810 121,480,563 105,882,553 105,627,194 outstanding - basic

Weighted average common shares 126,728,602 126,855,810 121,480,563 106,148,247 106,306,615 outstanding - diluted



Annualized return on 9.00 %9.82 %(1.63) %2.37 %7.52 %average equity

Annualized return on 1.01 %1.09 %(0.18) %0.30 %0.97 %average assets

Annualized return on 12.27 %13.28 %(2.22) %3.28 %10.32 %tangible common equity **



Efficiency ratio62.18 %59.68 %58.19 %64.67 %63.01 %*

Annualized noninterest 2.42 %2.39 %2.30 %2.83 %2.80 %expense to average assets *

* Excludes acquisition/branch optimization expenses and amortization of intangible assets (non-GAAP).

** Excludes goodwill and other intangible assets (non-GAAP).

Northwest Bancshares, Inc. and Subsidiaries Consolidated Statements of Income (Unaudited) (dollars in thousands, except per share amounts)



Year ended December 31,

2020 2019

Interest income:

Loans receivable $410,907 394,809

Mortgage-backed securities 17,416 16,670

Taxable investment securities 1,985 3,401

Tax-free investment securities 2,060 844

FHLB dividends 981 1,056

Interest-earning deposits 719 600

Total interest income 434,068 417,380

Interest expense:

Deposits 35,896 49,216

Borrowed funds 6,444 7,698

Total interest expense 42,340 56,914

Net interest income 391,728 360,466

Provision for credit losses 83,975 22,659

Net interest income after provision for credit 307,753 337,807 losses

Noninterest income:

Gain on sale of investments 236 50

Gain on sale of loans 1,302 1,734

Service charges and fees 55,613 53,065

Trust and other financial services income 20,922 17,765

Insurance commission income 9,132 8,068

Loss on real estate owned, net (106) (53)

Income from bank-owned life insurance 5,190 4,418

Mortgage banking income 31,391 3,819

Other operating income 8,585 10,541

Total noninterest income 132,265 99,407

Noninterest expense:

Compensation and employee benefits 178,375 163,086

Premises and occupancy costs 30,622 28,717

Office operations 15,728 14,133

Collections expense 3,275 2,560

Processing expenses 50,050 42,453

Marketing expenses 7,695 6,998

Federal deposit insurance premiums 4,767 685

Professional services 12,482 12,287

Amortization of intangible assets 6,856 6,543

Real estate owned expense 359 478

Acquisition/branch optimization expense 20,789 4,168

Other expenses 16,494 13,995

Total noninterest expense 347,492 296,103

Income before income taxes 92,526 141,111

Income tax expense 17,672 30,679

Net income $74,854 110,432



Basic earnings per share $0.62 1.05

Diluted earnings per share $0.62 1.04



Weighted average common shares outstanding - basic 120,244,474104,878,774

Weighted average common shares outstanding - diluted120,244,474105,839,149



Return on average equity 4.72 %8.36 %

Return on average assets 0.58 %1.07 %

Return on tangible common equity ** 6.59 %11.22 %



Efficiency ratio * 61.04 %62.06 %

Noninterest expense to average assets * 2.48 %2.76 %

* Excludes acquisition/branch optimization expenses and amortization of intangible assets (non-GAAP).

** Excludes goodwill and other intangible assets (non-GAAP).

Northwest Bancshares, Inc. and Subsidiaries Reconciliation of Non-GAAP to GAAP Net Income (Unaudited) * (dollars in thousands, except per share amounts)



Quarter ended December 31, Year ended December 31,

2020 2019 2020 2019

Operating results (non-GAAP):

Net interest income $102,888 88,945 391,728 360,466

Provision for credit 2,647 8,223 24,198 22,659 losses

Noninterest income 32,123 28,213 132,265 99,407

Noninterest expense 85,611 75,457 328,703 291,935

Income taxes 9,988 7,085 39,670 31,846

Net operating income $36,765 26,393 131,422 113,433 (non-GAAP)

Diluted earnings per $0.29 0.25 1.09 1.07 share (non-GAAP)



Average equity $1,550,481 1,349,803 1,584,747 1,321,452

Average assets 13,791,854 10,447,710 12,892,120 10,329,017

Annualized return on average equity 9.43 %7.76 %8.29 %8.58 %(non-GAAP)

Annualized return on average assets 1.06 %1.00 %1.02 %1.10 %(non-GAAP)



Reconciliation of net operating income to net income:

Net operating income $36,765 26,393 131,422 113,433 (non-GAAP)

Non-GAAP adjustments, net of tax:

COVID-related 3,511 - (29,951) - provision **

CECL provision impact due to acquisition of- - (13,089) - MutualBank

PPP deferred - - 3,034 - origination costs

COVID-related off balance sheet - - (1,594) - provision **

Acquisition/branch (5,211) (802) (14,968) (3,001) optimization expense

Net income (GAAP) $35,065 25,591 74,854 110,432

Diluted earnings per $0.28 0.24 0.62 1.04 share (GAAP)



Annualized return on 9.00 %7.52 %4.72 %8.36 %average equity (GAAP)

Annualized return on 1.01 %0.97 %0.58 %1.07 %average assets (GAAP)

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 estimated COVID-related provision, CECL provision related to the acquisition of MutualBank, PPP deferred origination costs, estimated* COVID-related off balance sheet provision and acquisition/branch optimization expense. The net tax effect was calculated using statutory tax rates of approximately 28.0%. The Company believes this non-GAAP presentation provides a meaningful comparison of operational performance and facilitates a more effective evaluation and comparison of results to assess performance in relation to ongoing operations.

To arrive at the non-COVID related provision estimates, the Company applied** Moody's forecast scenarios prior to the onset of COVID-19 to the Company's loan portfolio at December 31, 2020.

Northwest Bancshares, Inc. and Subsidiaries Regulatory Capital Requirements (Unaudited) (dollars in thousands)



At December 31, 2020

Actual Minimum capital Well capitalized requirements (1) requirements

Amount Ratio Amount Ratio Amount Ratio

Total capital (to risk weighted assets)

Northwest $1,654,20816.641%$1,043,79010.500%$994,08610.000%Bancshares, Inc.

Northwest Bank 1,478,320 14.886%1,042,751 10.500%993,096 10.000%



Tier 1 capital (to risk weighted assets)

Northwest 1,406,320 14.147%844,973 8.500 %795,268 8.000 %Bancshares, Inc.

Northwest Bank 1,354,027 13.634%844,132 8.500 %794,477 8.000 %



Common equity tier 1 capital (to risk weighted assets)

Northwest 1,281,515 12.891%695,860 7.000 %646,156 6.500 %Bancshares, Inc.

Northwest Bank 1,354,027 13.634%695,167 7.000 %645,513 6.500 %



Tier 1 capital (leverage) (to average assets)

Northwest Bancshares, Inc.1,406,320 10.145%554,501 4.000 % 5.000 % 693,126

Northwest Bank 1,354,027 9.903 %546,905 4.000 %683,631 5.000 %

Amounts and ratios include the capital conservation buffer of 2.5%, which does not apply to Tier 1 capital to average assets (leverage ratio). For(1) further information related to the capital conservation buffer, see "Item 1. Business - Supervision and Regulation" of our 2019 Annual Report on Form 10-K.

Northwest Bancshares, Inc. and Subsidiaries Marketable Securities (Unaudited) (dollars in thousands)



At December 31, 2020

Gross Gross Marketable securities Amortized unrealizedunrealizedFair valueavailable-for-sale cost holding holding gains losses

Debt issued by the U.S. government and agencies:

Due after ten years $40,761 211 (55) 40,917



Debt issued by government sponsored enterprises:

Due in less than one 24,976 159 - 25,135 year

Due in one year through 238 3 - 241 five years

Due in five years 68,973 238 (80) 69,131 through ten years



Municipal securities:

Due in less than one 4,008 14 - 4,022 year

Due in one year through 2,803 63 (2) 2,864 five years

Due in five years 16,045 429 (5) 16,469 through ten years

Due after ten years 89,778 3,752 (72) 93,458



Residential mortgage-backed securities:

Fixed rate pass-through 339,406 7,125 (86) 346,445

Variable rate 14,778 431 (20) 15,189 pass-through

Fixed rate agency CMOs 723,586 11,758 (1,093) 734,251

Variable rate agency 50,333 519 (33) 50,819 CMOs

Total residential 1,128,103 19,833 (1,232) 1,146,704mortgage-backed securities

Total marketable securities $1,375,68524,702 (1,446) 1,398,941available-for-sale



Marketable securities held-to-maturity

Debt issued by the U.S. government and agencies:

Due in five years $67,990 12 (123) 67,879 through ten years



Residential mortgage-backed securities:

Fixed rate pass-through 22,039 135 - 22,174

Variable rate 919 30 - 949 pass-through

Fixed rate agency CMOs 87,335 712 (2) 88,045

Variable rate agency 604 15 - 619 CMOs

Total residential 110,897 892 (2) 111,787 mortgage-backed securities

Total marketable $178,887 904 (125) 179,666 securities held-to-maturity

Northwest Bancshares, Inc. and Subsidiaries Borrowed Funds (Unaudited) (dollars in thousands)



At December 31, 2020

Amount Average rate

Term notes payable to the Federal Home Loan Bank (FHLB):

Payable to the FHLB of Indianapolis acquired from $22,054 1.92 % MutualBank

Total term notes payable to the FHLB 22,054

Collateralized borrowings, due within one year 137,661 0.19 %

Subordinated debentures, net of issuance costs 123,329 4.00 %

Total borrowed funds * $283,044

As of December 31, 2020, the Company had $3.9 billion of additional borrowing capacity available with the Federal Home Loan Bank of Pittsburgh,* including a $250.0 million overnight line of credit, which had no balance, as well as $95.4 million of borrowing capacity available with the Federal Reserve Bank and $110.0 million of borrowing capacity with three correspondent banks.

Northwest Bancshares, Inc. and Subsidiaries Asset Quality (Unaudited) (dollars in thousands)



December September 30,June 30, March December 31, 31, 2020 2020 31, 2019 2020 2020

Nonaccrual loans current:

Residential $21 1,128 413 285 72 mortgage loans

Home equity 154 366 481 592 197 loans

Consumer loans 207 234 214 77 78

Commercial real 20,317 22,610 30,677 14,337 9,241 estate loans

Commercial loans16,027 6,488 6,551 3,514 3,424

Total nonaccrual$36,726 30,826 38,336 18,805 13,012 loans current

Nonaccrual loans delinquent 30 days to 59 days:

Residential $647 60 61 691 674 mortgage loans

Home equity 338 445 247 159 224 loans

Consumer loans 301 230 335 143 121

Commercial real 1,416 692 2,372 496 196 estate loans

Commercial loans87 57 - - 55

Total nonaccrual loans delinquent$2,789 1,484 3,015 1,489 1,270 30 days to 59 days

Nonaccrual loans delinquent 60 days to 89 days:

Residential $767 576 1,013 218 1,048 mortgage loans

Home equity 190 618 960 539 689 loans

Consumer loans 583 781 666 488 417

Commercial real 714 2,745 163 2,096 413 estate loans

Commercial loans48 15 768 37 341

Total nonaccrual loans delinquent$2,302 4,735 3,570 3,378 2,908 60 days to 89 days

Nonaccrual loans delinquent 90 days or more:

Residential $14,489 14,750 15,369 10,457 12,682 mortgage loans

Home equity 8,441 7,845 7,060 5,816 5,635 loans

Consumer loans 5,473 5,352 6,896 3,459 3,610

Commercial real 25,287 35,496 29,729 25,342 25,014 estate loans

Commercial loans7,325 6,310 11,535 16,685 4,739

Total nonaccrual loans delinquent$61,015 69,753 70,589 61,759 51,680 90 days or more

Total nonaccrual$102,832 106,798 115,510 85,431 68,870 loans

Total nonaccrual$102,832 106,798 115,510 85,431 68,870 loans

Loans 90 days past maturity 585 495 77 31 32 and still accruing

Nonperforming 103,417 107,293 115,587 85,462 68,902 loans

Real estate 2,232 2,575 1,897 1,075 950 owned, net

Nonperforming $105,649 109,868 117,484 86,537 69,852 assets

Nonaccrual troubled debt $10,704 17,120 17,562 17,375 9,043 restructuring *

Accruing troubled debt 21,431 17,684 17,888 15,977 22,956 restructuring

Total troubled debt $32,135 34,804 35,450 33,352 31,999 restructuring



Nonperforming loans to total 0.98 %1.00 % 1.06 %0.97 %0.78 % loans

Nonperforming assets to total 0.77 %0.80 % 0.85 %0.81 %0.67 % assets

Allowance for credit losses to1.27 %1.30 % 1.29 %1.05 %0.66 % total loans

Allowance for total loans 1.32 %1.36 % 1.36 %N/A N/A excluding PPP loan balance

Allowance for credit losses to129.99 %130.68 % 121.63 %108.70%84.09 % nonperforming loans

* Amounts included in nonperforming loans above.

Northwest Bancshares, Inc. and Subsidiaries Loans by Credit Quality Indicators (Unaudited) (dollars in thousands)



At December Special Loans 31, 2020 Pass Substandard**Doubtful***Lossreceivable mention*

Personal Banking:

Residential $3,042,544 - 25,577 - - 3,068,121 mortgage loans

Home equity 1,455,474 - 12,262 - - 1,467,736 loans

Consumer loans1,499,004 - 8,989 - - 1,507,993

Total Personal5,997,022 - 46,828 - - 6,043,850 Banking

Commercial Banking:

Commercial real estate 2,852,705 108,021385,163 - - 3,345,889 loans

Commercial 1,092,498 41,278 57,334 - - 1,191,110 loans

Total Commercial 3,945,203 149,299442,497 - - 4,536,999 Banking

Total loans $9,942,225 149,299489,325 - - 10,580,849

At September 30, 2020

Personal Banking:

Residential $3,117,442 - 25,927 - - 3,143,369 mortgage loans

Home equity 1,471,919 - 12,446 - - 1,484,365 loans

Consumer loans1,478,109 - 8,974 - - 1,487,083

Total Personal6,067,470 - 47,347 - - 6,114,817 Banking

Commercial Banking:

Commercial real estate 2,850,611 110,073359,059 - - 3,319,743 loans

Commercial 1,255,255 40,631 51,406 - - 1,347,292 loans

Total Commercial 4,105,866 150,704410,465 - - 4,667,035 Banking

Total loans $10,173,336150,704457,812 - - 10,781,852

At June 30, 2020

Personal Banking:

Residential $3,196,304 - 26,451 - - 3,222,755 mortgage loans

Home equity 1,438,339 - 12,031 - - 1,450,370 loans

Consumer loans1,508,129 - 9,990 - - 1,518,119

Total Personal6,142,772 - 48,472 - - 6,191,244 Banking

Commercial Banking:

Commercial real estate 3,034,984 72,755 199,993 1,092 - 3,308,824 loans

Commercial 1,270,279 41,458 42,692 4,290 - 1,358,719 loans

Total Commercial 4,305,263 114,213242,685 5,382 - 4,667,543 Banking

Total loans $10,448,035114,213291,157 5,382 - 10,858,787

At March 31, 2020

Personal Banking:

Residential $2,830,596 - 7,690 - - 2,838,286 mortgage loans

Home equity 1,345,052 - 8,211 - - 1,353,263 loans

Consumer loans1,174,067 - 3,988 - - 1,178,055

Total Personal5,349,715 - 19,889 - - 5,369,604 Banking

Commercial Banking:

Commercial real estate 2,537,736 73,967 143,765 - - 2,755,468 loans

Commercial 618,267 43,071 50,464 - - 711,802 loans

Total Commercial 3,156,003 117,038194,229 - - 3,467,270 Banking

Total loans $8,505,718 117,038214,118 - - 8,836,874

At December 31, 2019

Personal Banking:

Residential $2,858,582 - 9,545 - - 2,868,127 mortgage loans

Home equity 1,336,111 - 6,807 - - 1,342,918 loans

Consumer loans1,120,732 - 4,400 - - 1,125,132

Total Personal5,315,425 - 20,752 - - 5,336,177 Banking

Commercial Banking:

Commercial real estate 2,538,816 80,570 135,004 - - 2,754,390 loans

Commercial 616,983 42,380 58,744 - - 718,107 loans

Total Commercial 3,155,799 122,950193,748 - - 3,472,497 Banking

Total loans $8,471,224 122,950214,500 - - 8,808,674

Includes $31.3 million, $34.7 million, $37.4 million, $13.1 million, and* $10.3 million of acquired loans at December 31, 2020, September 30, 2020, June 30, 2020, March 31, 2020, and December 31, 2019, respectively.

Includes $153.2 million, $129.2 million, $108.2 million, $56.8 million, and** $53.1 million of acquired loans at December 31, 2020, September 30, 2020, June 30, 2020, March 31, 2020, and December 31, 2019, respectively.

*** Includes $1.1 million of acquired loans at June 30, 2020.

Northwest Bancshares, Inc. and Subsidiaries Loan Delinquency (Unaudited) (dollars in thousands)



December 31, * September 30, * June 30, * March 31, * December 31, * 2020 2020 2020 2020 2019

(Number of loans and dollar amount of loans)

Loans delinquent 30 days to 59 days:

Residential 0.8mortgage 315 $28,797 0.9% 17 $736 - % 15 $629 - % 358 $32,755 1.2% 292 $23,296 loans %

Home equity 0.5loans 138 4,763 0.3% 129 4,984 0.3% 118 4,569 0.3% 190 7,061 0.5% 173 6,469 %

Consumer 0.8loans 1,27910,574 0.7% 1,0788,586 0.6% 629 7,199 0.5% 953 8,774 0.7% 960 9,208 %

Commercial 0.3real estate43 10,923 0.3% 28 5,090 0.2% 46 14,177 0.4% 58 12,895 0.5% 43 7,921 loans %

Commercial 0.2loans 37 6,405 0.5% 19 1,797 0.1% 12 1,242 0.1% 35 7,545 1.1% 32 1,187 %

Total loans 0.5delinquent 1,812$61,462 0.6% 1,271$21,193 0.2% 820 $27,816 0.3% 1,594$69,030 0.8% 1,500$48,081 30 days to % 59 days



Loans delinquent 60 days to 89 days:

Residential 0.2mortgage 84 $5,083 0.2% 65 $4,788 0.2% 64 $5,364 0.2% 11 $511 - % 67 $5,693 loans %

Home equity 0.2loans 47 1,656 0.1% 56 1,860 0.1% 59 2,326 0.2% 65 2,652 0.2% 66 2,405 %

Consumer 0.3loans 322 2,742 0.2% 323 3,049 0.2% 258 2,916 0.2% 265 2,610 0.2% 395 3,302 %

Commercial 0.1real estate11 1,615 - % 14 4,212 0.1% 18 3,913 0.1% 12 2,981 0.1% 19 1,690 loans %

Commercial 0.9loans 10 864 0.1% 7 357 - % 15 1,151 0.1% 10 309 - % 17 6,403 %

Total loans 0.2delinquent 474 $11,960 0.1% 465 $14,266 0.1% 414 $15,670 0.1% 363 $9,063 0.1% 564 $19,493 60 days to % 89 days



Loans delinquent 90 days or more: **

Residential 0.4mortgage 168 $14,489 0.5% 168 $14,750 0.5% 185 $15,369 0.5% 129 $10,457 0.4% 141 $12,775 loans %

Home equity 0.4loans 207 8,441 0.6% 193 7,845 0.5% 182 7,060 0.5% 152 5,816 0.4% 159 5,688 %

Consumer 0.3loans 720 6,058 0.4% 696 5,847 0.4% 709 6,896 0.5% 445 3,459 0.3% 590 3,611 %

Commercial 0.9real estate119 25,287 0.8% 136 35,496 1.1% 149 29,729 0.9% 139 25,342 0.9% 129 25,014 loans %

Commercial 0.7loans 37 7,325 0.6% 34 6,310 0.5% 47 11,535 0.8% 51 16,685 0.2% 37 4,739 %

Total loans 0.6delinquent 1,251$61,600 0.6% 1,227$70,248 0.7% 1,272$70,589 0.7% 916 $61,759 0.7% 1,056$51,827 90 days or % more



Total loans 1.4delinquent 3,537$135,0221.3% 2,963$105,7071.0% 2,506$114,0751.1% 2,873$139,8521.6% 3,120$119,401 %

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

Includes purchased credit deteriorated loans of $6.6 million, $20.3** million, $18.0 million, and $298,000 at December 31, 2020, September 30, 2020, June 30, 2020, March 31, 2020, respectively, and purchased credit impaired loans of $147,000 at December 31, 2019.

Northwest Bancshares, Inc. and Subsidiaries Analysis of Loan Portfolio by Loan Sector (Unaudited) (dollars in thousands)



Loans outstanding

The following table provides delinquency information for various loan sectors in our portfolio that are potentially vulnerable to the COVID-19 pandemic impacts at December 31, 2020:



At December 30-59 days 60-89 days 90 days Total Total 31, 2020 delinquent* delinquent* or greater* delinquent* Current * loans * delinquent receivable

Restaurants/ $417 - %$276 - %$754 - %$1,447 - %$91,703 0.9 %$93,150 0.9 %bars

Hotels/ - - %- - %1,074 - %1,074 - %177,016 1.7 %178,090 1.7 %hospitality

Gyms and - - %- - %- - %- - %4,113 - %4,113 - %fitness

Transportation33 - %43 - %431 - %507 - %72,786 0.7 %73,293 0.7 %

Oil and gas - - %- - %7 - %7 - %10,083 0.1 %10,090 0.1 %

Residential care - - %- - %500 - %500 - %246,221 2.3 %246,721 2.3 %facilities

Retail 1,072 - %- - %520 - %1,592 - %443,275 4.2 %444,867 4.2 %buildings

Education/ student - - %- - %1,872 - %1,872 - %139,790 1.3 %141,662 1.3 %housing

Construction/ development:

Education/ student - - %- - %- - %- - %51,675 0.5 %51,675 0.5 %housing

Hotels/ - - %- - %- - %- - %25,633 0.2 %25,633 0.2 %hospitality

Residential care - - %- - %- - %- - %37,604 0.4 %37,604 0.4 %facilities

All other construction/ 268 - %- - %5,465 0.1%5,733 0.1%183,947 1.7 %189,680 1.8 %development

All other 59,672 0.6%11,641 0.1%50,977 0.5%122,290 1.2%8,961,981 84.7%9,084,271 85.9 %sectors

Total loans$61,462 0.6%$11,960 0.1%$61,600 0.6%$135,0221.3%$10,445,82798.7%$10,580,849100.0%

* Percent of total loans outstanding.

Loan deferrals

The following table represents loans that entered into and are currently in a deferment offered by the Company to aid customers in the COVID-19 pandemic as of December 31, 2020. Of these loan deferrals, 257 borrowers applied for and received PPP loans totaling approximately $39.9 million:



Loans returned to New loans entered Balance as of full payment into Balance as of September 30, 2020 status, net of first deferral December 31, 2020 payments

NumberOutstanding NumberOutstandingNumberOutstandingNumberOutstanding of principal * of principal of principal of principal * loans balance loans balance loans balance loans balance

Residential mortgage 111 $15,967 0.5%90 $12,914 22 $ 3,389 43 $6,442 0.2%loans

Home equity48 3,639 0.2%37 2,536 30 1,512 41 2,615 0.2%loans

Consumer 123 2,348 0.2%102 1,950 62 901 83 1,299 0.1%loans

Commercial real estate94 183,661 5.5%71 68,855 11 3,406 34 118,212 3.5%loans

Commercial 28 7,085 0.5%14 6,071 8 318 22 1,332 0.1%loans

Total 404 $212,700 2.0%314 $92,326 133 $ 9,526 223 $129,900 **1.2%loans

* Percent of total loans outstanding by the respective total amount of that type of loan.

As of December 31, 2020, first loan deferrals totaled $9.5 million, second loan deferrals totaled $67.5 million, and third loan deferrals totaled** $52.9 million. $91.9 million of loan deferrals expire in Q1 2021 and $38.0 million of loan deferrals expire in Q2 2021. In addition, of the $129.9 million total loan deferrals, $108.7 million are in the hospitality industry.

Northwest Bancshares, Inc. and Subsidiaries Allowance for Credit Losses (Unaudited) (dollars in thousands)



Quarter ended

December 31, September 30,June 30, March 31,December 31, 2020 2020 2020 2020 2019

Beginning balance $ 140,209 140,586 92,897 57,941 52,859

CECL adoption - - - 10,792 -

Initial allowance on loans purchased with credit deterioration- - 8,845 - -

Provision (2,230) 6,818 51,750 27,637 8,223

Charge-offs residential mortgage (407) (129) (38) (343) (222)

Charge-offs home equity (58) (88) (173) (289) (113)

Charge-offs consumer (2,623) (3,356) (3,191) (3,488) (3,142)

Charge-offs commercial real estate (2,770) (532) (690) (331) (107)

Charge-offs commercial (156) (4,892) (10,349) (815) (1,143)

Recoveries 2,462 1,802 1,535 1,793 1,586

Ending balance $ 134,427 140,209 140,586 92,897 57,941

Net charge-offs to average loans, annualized 0.13 % 0.27 % 0.51 %0.16 %0.14 %

Year ended December 31,

2020 2019

Beginning balance $57,941 55,214

CECL adoption 10,792 -

Initial allowance on loans purchased with credit 8,845 - deterioration

Provision 83,975 22,659

Charge-offs residential mortgage (917) (1,166)

Charge-offs home equity (608) (1,121)

Charge-offs consumer (12,658) (11,807)

Charge-offs commercial real estate (4,323) (5,467)

Charge-offs commercial (16,212) (6,651)

Recoveries 7,592 6,280

Ending balance $134,427 57,941

Net charge-offs to average loans 0.27 %0.23 %

December 31, 2020

Originated loans Acquired loans Total loans

Balance Reserve Balance ReserveBalance Reserve

Residential $2,753,5936,049 314,528 1,217 3,068,121 7,266 mortgage loans

Home equity loans1,175,703 4,579 292,033 1,413 1,467,736 5,992

Consumer loans 1,283,106 14,949 224,887 2,747 1,507,993 17,696

Personal Banking 5,212,402 25,577 831,448 5,377 6,043,850 30,954 Loans

Commercial real 2,567,124 70,707 778,765 19,1923,345,889 89,899 estate loans

Commercial loans 1,019,482 6,590 171,628 6,984 1,191,110 13,574

Commercial 3,586,606 77,297 950,393 26,1764,536,999 103,473Banking Loans

Total Loans $8,799,008102,8741,781,84131,55310,580,849134,427

Northwest Bancshares, Inc. and Subsidiaries Average Balance Sheet (Unaudited) (dollars in thousands)



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



Quarter ended

December 31, 2020 September 30, 2020 June 30, 2020 March 31, 2020 December 31, 2019

Avg. Avg. Avg. Avg. Avg. Average Interest yield/Average Interest yield/Average Interest yield/Average Interest yield/Average Interestyield/ balance cost balance cost balance cost balance cost balance cost (h) (h) (h) (h) (h)

Assets:

Interest-earning assets:

Residential mortgage loans $3,089,916 27,503 3.56%$3,176,436 28,769 3.62%$3,092,392 29,019 3.75%$2,845,483 28,062 3.94%$2,847,932 28,011 3.93%

Home equity loans 1,472,527 13,535 3.66%1,479,429 13,732 3.69%1,415,091 13,806 3.92%1,345,059 14,801 4.43%1,333,748 15,354 4.57%

Consumer loans 1,444,860 15,874 4.37%1,437,828 15,851 4.39%1,375,130 14,993 4.39%1,123,336 12,160 4.35%1,073,565 12,016 4.44%

Commercial real estate 3,317,418 37,965 4.48%3,306,386 36,887 4.37%3,156,749 34,595 4.34%2,747,419 31,437 4.53%2,741,687 32,985 4.71%loans

Commercial loans 1,325,047 11,414 3.37%1,377,223 12,603 3.58%1,161,228 11,269 3.84%712,621 8,856 4.92%717,438 9,841 5.37%

Total loans receivable (a) 10,649,768 106,291 3.97%10,777,302 107,842 3.98%10,200,590 103,682 4.09%8,773,918 95,316 4.37%8,714,370 98,207 4.47%(b) (d)

Mortgage-backed securities 1,166,739 4,551 1.56%1,004,803 4,651 1.85%714,657 4,038 2.26%668,470 4,175 2.50%667,910 4,237 2.54%(c)

Investment securities (c) 252,898 1,380 2.18%216,081 1,336 2.47%170,309 1,244 2.92%144,152 881 2.44%151,289 938 2.48%(d)

FHLB stock, at cost 23,346 192 3.27%25,595 218 3.39%22,192 309 5.60%15,931 262 6.61%13,400 262 7.76%

Other interest-earning 632,494 178 0.11%791,601 221 0.11%623,870 185 0.12%34,697 135 1.54%31,624 169 2.09%deposits

Total interest-earning 12,725,245 112,592 3.52%12,815,382 114,268 3.55%11,731,618 109,458 3.75%9,637,168 100,769 4.21%9,578,593 103,8134.30%assets

Noninterest-earning assets 1,066,609 1,088,273 1,858,513 960,303 869,117 (e)

Total assets $13,791,854 $13,903,655 $13,590,131 $10,597,471 $10,447,710

Liabilities and shareholders' equity:

Interest-bearing liabilities:

Savings deposits $2,028,155 617 0.12%$2,015,604 648 0.13%$1,884,202 648 0.14%$1,611,111 727 0.18%$1,615,996 792 0.19%

Interest-bearing demand 2,699,515 476 0.07%2,680,591 763 0.11%2,428,060 812 0.13%1,915,871 1,307 0.27%1,769,623 1,570 0.35%deposits

Money market deposit 2,426,513 960 0.16%2,347,097 1,347 0.23%2,204,810 1,600 0.29%1,921,243 3,088 0.65%1,845,535 3,226 0.69%accounts

Time deposits 1,676,094 4,660 1.11%1,782,350 5,685 1.27%1,761,260 6,276 1.43%1,528,891 6,281 1.65%1,607,992 7,305 1.80%

Borrowed funds (f) 352,392 1,469 1.66%420,715 717 0.68%371,700 296 0.32%240,118 709 1.19%177,670 444 0.99%

Junior subordinated 128,752 659 2.00%128,658 720 2.19%127,472 837 2.60%121,809 1,038 3.37%121,796 1,136 3.65%debentures

Total interest-bearing 9,311,421 8,841 0.38%9,375,015 9,880 0.42%8,777,504 10,469 0.48%7,339,043 13,150 0.72%7,138,612 14,473 0.80%liabilities

Noninterest-bearing demand 2,675,986 2,703,266 2,401,368 1,640,180 1,800,861 deposits (g)

Noninterest-bearing 253,966 284,440 882,391 268,139 158,434 liabilities

Total liabilities 12,241,373 12,362,721 12,061,263 9,247,362 9,097,907

Shareholders' equity 1,550,481 1,540,934 1,528,868 1,350,109 1,349,803

Total liabilities and $13,791,854 $13,903,655 $13,590,131 $10,597,471 $10,447,710 shareholders' equity

Net interest income/ 103,751 3.14% 104,388 3.13% 98,989 3.27% 87,619 3.48% 89,340 3.50%Interest rate spread

Net interest-earning assets$3,413,824 3.26%$3,440,367 3.26%$2,954,114 3.38%$2,298,125 3.66%$2,439,981 3.73%/Net interest margin

Ratio of interest-earning assets to interest-bearing 1.37X 1.37X 1.34X 1.31X 1.34X liabilities

(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 ("FTE") 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, collateralized borrowings, and subordinated debt.

(g) Average cost of deposits were 0.23%, 0.29%, 0.35%, 0.53%, and 0.59%, respectively.

Shown on a FTE basis. GAAP basis yields for the periods indicated were - Loans: 3.94%, 3.96%, 4.06%, 4.35%, and 4.46%, respectively, Investment(h) securities: 1.78%, 2.00%, 2.36%, 2.31%, and 2.34%, respectively, Interest-earning assets: 3.48%, 3.52%, 3.72%, 4.19%, and 4.28%, respectively. GAAP basis net interest rate spreads were 3.11%, 3.10%, 3.24%, 3.47%, and 3.48%, respectively, and GAAP basis net interest margins were 3.23%, 3.23%, 3.34%, 3.64%, and 3.71%, respectively.

Northwest Bancshares, Inc. and Subsidiaries Average Balance Sheet (Unaudited) (dollars in thousands)



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



Year ended December 31,

2020 2019

Avg. Avg. Average Interestyield/Average Interestyield/ balance cost balance cost (h) (h)

Assets:

Interest-earning assets:

Residential mortgage loans $3,051,582 113,3533.71%$2,860,765 115,5834.04%

Home equity loans 1,436,632 55,875 3.89%1,308,908 64,222 4.91%

Consumer loans 1,338,120 58,878 4.40%980,623 44,859 4.57%

Commercial real estate loans 3,132,976 140,8834.42%2,725,792 132,9154.81%

Commercial loans 1,145,143 44,142 3.79%678,866 38,565 5.60%

Loans receivable (a) (b) (d) 10,104,453 413,1314.09%8,554,954 396,1444.63%

Mortgage-backed securities (c) 889,744 17,416 1.96%639,764 16,670 2.61%

Investment securities (c) (d) 196,071 4,841 2.47%205,757 4,470 2.17%

FHLB stock, at cost 21,781 981 4.50%14,477 1,056 7.29%

Other interest-earning deposits 520,666 719 0.14%23,305 600 2.54%

Total interest-earning assets 11,732,715 437,0883.73%9,438,257 418,9404.44%

Noninterest-earning assets (e) 1,159,405 890,760

Total assets $12,892,120 $10,329,017

Liabilities and shareholders' equity:

Interest-bearing liabilities:

Savings deposits $1,885,517 2,640 0.14%$1,655,495 3,115 0.19%

Interest-bearing demand deposits 2,432,427 3,358 0.14%1,651,393 6,012 0.36%

Money market deposit accounts 2,224,904 6,995 0.31%1,778,661 13,010 0.73%

Time deposits 1,687,381 22,903 1.36%1,555,726 27,079 1.74%

Borrowed funds (f) 346,442 3,190 0.92%206,458 2,865 1.39%

Junior subordinated debentures 126,683 3,254 2.53%120,012 4,833 3.97%

Total interest-bearing liabilities 8,703,354 42,340 0.49%6,967,745 56,914 0.82%

Noninterest-bearing demand deposits (g) 2,357,725 1,835,622

Noninterest-bearing liabilities 246,294 204,198

Total liabilities 11,307,373 9,007,565

Shareholders' equity 1,584,747 1,321,452

Total liabilities and shareholders' equity$12,892,120 $10,329,017

Net interest income/Interest rate spread 394,7483.24% 362,0263.62%

Net interest-earning assets/Net interest $3,029,361 3.36%$2,470,512 3.84%margin

Ratio of interest-earning assets to 1.35X 1.35X interest-bearing liabilities

(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, collateralized borrowings, and subordinated debt.

(g) Average cost of deposits were 0.34% and 0.58%, respectively.

Shown on a FTE basis. GAAP basis yields for the periods indicated were - Loans: 4.07% and 4.61%, respectively, Investment securities: 2.06% and(h) 2.06%, respectively, Interest-earning assets: 3.70% and 4.42%, respectively. GAAP basis net interest rate spreads were 3.21% and 3.61%, respectively, and GAAP basis net interest margins were 3.34% and 3.82%, respectively.

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SOURCE Northwest Bancshares, Inc.