WARREN, Pa., July 22, 2019 /PRNewswire/ -- Northwest Bancshares, Inc., (the "Company"), (NasdaqGS: NWBI) announced net income for the quarter ended June 30, 2019 of $26.4 million, or $0.25 per diluted share. This represents an increase of $84,000, or 0.3%, compared to the same quarter last year when net income was $26.3 million or $0.25 per diluted share. The annualized returns on average shareholders' equity and average assets for the quarter ended June 30, 2019 were 8.01% and 1.02% compared to 8.67% and 1.11% for the same quarter last year.

The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.18 per share payable on August 15, 2019 to shareholders of record as of August 1, 2019. This is the 99th consecutive quarter in which the Company has paid a cash dividend. Based on the market value of the Company's stock as of June 30, 2019, this represents an annualized dividend yield of approximately 4.09%.

In making this announcement, Ronald J. Seiffert, Chairman, President and CEO, noted, "We were extremely pleased with loan growth for both the current quarter of 1.9% and for the first six months of the year of 3.5%." Mr. Seiffert added that "despite the expected six basis point decline in our net interest margin during the quarter due to the shape of the yield curve, we believe it is very important to continue to grow and diversify our loan portfolio."  He continued, "As the result of strategic investments that we made during the first half of this year, we are extremely well-positioned to focus on sales execution and operating efficiencies for the remainder of 2019. These investments included the successful integration of Union Community Bank, the implementation of nCino as our new commercial loan origination platform and Ellie Mae's Encompass as our new residential mortgage loan origination platform, as well as the staffing of our commercial and residential mortgage loan origination teams."

Net interest income increased by $8.4 million, or 10.0%, to $92.6 million for the quarter ended June 30, 2019, from $84.2 million for the quarter ended June 30, 2018, primarily due to a $12.8 million, or 14.5%, increase in interest income on loans receivable and a $1.0 million, or 31.5%, increase in interest income on mortgage-backed securities. These increases were primarily due to increases of $743.4 million, or 9.5%, and $75.0 million, or 13.2%, in the average balances of loans and mortgage-backed securities, respectively.  Additionally, the average yield on loans and mortgage-backed securities increased by 21 and 37 basis points, respectively, over the prior year period. Partially offsetting this improvement was an increase in interest expense on deposits of $5.2 million, or 70.8%, due to increases in market interest rates that have occurred over the past year. The net impact of these changes caused the Company's net interest margin to increase to 3.91% for the quarter ended June 30, 2019 from 3.86% for the same quarter last year.

The provision for loan losses decreased by $682,000, or 12.8%, to $4.7 million for the quarter ended June 30, 2019, from $5.3 million for the quarter ended June 30, 2018. The provision was elevated in the prior year due primarily to the closure of the Company's consumer finance subsidiary and the runoff of the legacy portfolio.  During the current quarter, net charge-offs were elevated due to an additional write down of approximately $4.0 million on a residential land development loan in our Western New York region.  This write down was previously fully reserved.

Noninterest income decreased by $746,000, or 3.1%, to $23.4 million for the quarter ended June 30, 2019, from $24.1 million for the quarter ended June 30, 2018. This decrease was primarily due to a $1.1 million, or 48.7%, decline in bank owned life insurance income due to a death benefit received during the prior year.  Partially offsetting this decline was an increase in service charges and fees of $431,000, or 3.3%, to $13.3 million for the current quarter compared to $12.9 million for the prior year's quarter, primarily as a result of increased customer activity from the United Community Bank ("UCB") acquisition.  Additionally, there was an increase in trust and other financial services income of $394,000, or 9.7%, to $4.4 million for the quarter ended June 30, 2019, from $4.0 million for the same quarter last year primarily due to new brokerage production.

Noninterest expense increased by $7.7 million, or 11.1%, to $77.5 million for the quarter ended June 30, 2019, from $69.8 million for the quarter ended June 30, 2018. This increase resulted primarily from a $3.0 million, or 7.6%, increase in compensation and employee benefits due to both internal growth in compensation and staff as well as the addition of UCB employees. In addition, processing expenses increased by $1.1 million, or 11.2%, as we continue to invest in technology and infrastructure to meet the demands of becoming a $10.0 billion institution. Also contributing to this increase was an increase in restructuring and acquisition expense of $712,000 due to expenses incurred as part of the UCB acquisition.

Net income for the six month period ended June 30, 2019 was $51.4 million, or $0.49 per diluted share.  This represents an increase of $143,000, or 0.3%, compared to the six month period ended June 30, 2018, when net income was $51.3 million, or $0.50 per diluted share.  The annualized returns on average shareholders' equity and average assets for the six month period ended June 30, 2019 were 7.99% and 1.02% compared to 8.54% and 1.09% for the same period last year.  This increase in net income was the result of an increase in net interest income after provision of $13.0 million, or 8.3% which was partially offset by an increase in noninterest expense of $11.7 million, or 8.5%.  Contributing to the additional expense is the added cost of the Union Community Bank operations, including new marketing costs, additional processing costs associated with our new commercial and residential mortgage platforms as well as increased online banking usage fees, and the acquisition costs associated with the Union Community Bank conversion in March 2019.

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. Northwest operates 172 full-service community banking offices and ten free standing drive-through facilities in Pennsylvania, New York and Ohio. 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.

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SOURCE Northwest Bancshares, Inc.