Northway Financial, Inc. Announces First Quarter Earnings
April 26, 2024 at 08:01 am
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NORTH CONWAY, N.H., April 26, 2024 (GLOBE NEWSWIRE) -- Northway Financial, Inc. (the “Company”) (OTCQB: NWYF), the parent company of Northway Bank (the “Bank”), today reported net income for the quarter ended March 31, 2024 of $1.5 million, or $0.55 per basic common share, compared to $1.4 million, or $0.50 per basic common share for the quarter ended March 31, 2023.
President and CEO William J. Woodward commented: “In the first quarter, net income was consistent compared to last year. The high-rate environment continues to put downward pressure on our net interest margin. We are focusing on offsetting the margin compression by continuing to reduce operating costs without impacting customer service. Our non-municipal deposits are tracking well with our December 2023 levels. We are in the process of introducing new deposit products to further increase deposits. There is uncertainty regarding when the Federal Reserve will lower rates. We know that the inflationary environment impacts almost everyone.”
Financial Highlights
Total Assets were $1.2 billion, loans, net, were $909 million, and total deposits were $978 million at March 31, 2024.
Total Assets decreased $126 million compared to March 31, 2023, driven by decreases in Cash and Due from Banks and Interest-Bearing Deposits of $39 million, Securities Available-for-Sale of $52 million, and Loans, net of $30 million.
The decrease in Cash and Due from Banks and Interest-Bearing Deposits was due to the paydown of borrowings while the decrease in securities was primarily due to the $30 million in securities sales in December 2023.
Residential mortgage loan balances decreased $13 million and commercial real estate loan balances decreased $18 million, compared to March 31, 2023.
Non-Municipal Liabilities decreased $54 million or 6% compared to March 31, 2023, the result of a decrease in Retail Deposits of $31 million, or 5%, and a decrease in Commercial Liabilities of $12 million, or 9%.
Compared to December 31, 2023, Non-Municipal Liabilities increased $12 million.
Short Term Borrowings and Long-Term Debt decreased $85 million compared to March 31, 2023.
Net Income for the quarter ending March 31, 2024, was $1.5 million or $0.55 per basic common share.
Net Interest Income was $826 thousand lower than the same period last year and was partially offset by lower operating expenses of $388 thousand.
The Year-to-Date Net Interest Margin decreased from 2.87% to 2.70% as funding costs increased 1.17% while the yield on earning assets increased 0.66%, when compared to year-to-date March 31, 2023.
Nonperforming loans as a percentage of total loans stood at 0.36% compared to 0.24% at March 31, 2023.
Total delinquent loans as a percentage of total loans were 0.31% compared to 0.28% at March 31, 2023.
The Bank’s regulatory capital ratios at March 31, 2024 exceeded all well-capitalized ratios as defined under FDIC’s prompt corrective action rules.
The market price of our common stock, as of April 25, 2024, was $18.25.
Northway Financial, Inc.
Selected Financial Highlights
(Unaudited)
(Dollars in thousands, except per share data)
Three Months Ended
3/31/2024
3/31/2023
Interest and Dividend Income
$
12,588
$
11,948
Interest Expense
4,351
2,885
Net Interest and Dividend Income
8,237
9,063
Provision for Credit Losses
-
-
All Other Noninterest Income
1,257
1,246
Noninterest Expense
8,086
8,474
Net Income Before Gain (Loss) on Securities
1,408
1,835
Gain (Loss) on Securities Available-for-Sale, Net
-
-
Gain (Loss) on Marketable Equity Securities
277
(250
)
Income before Income Tax Expense
1,685
1,585
Income Tax Expense
173
210
Net Income
$
1,512
$
1,375
Net Income Available to Common Stockholders
$
1,512
$
1,375
Earnings per Common Share, Basic
$
0.55
$
0.50
3/31/2024
12/31/2023
3/31/2023
Balance Sheet
Total Assets
$
1,244,319
$
1,290,467
$
1,369,822
Cash and Due from Banks and Interest-Bearing Deposits
37,075
68,887
76,306
Securities Available-for-Sale, at Fair Value
238,806
246,756
290,511
Marketable Equity Securities, at Fair Value
2,867
2,589
5,467
Loans Held-for-Sale
716
-
690
Loans, Net
908,614
909,781
938,470
Total Liabilities
1,173,293
1,217,230
1,300,726
Non Municipal Non-Maturity Deposits
727,635
734,741
773,702
Municipal Non-Maturity Deposits
120,516
133,100
127,777
Certificates of Deposit
129,157
127,726
111,716
Securities Sold Under Agreements to Repurchase
45,680
55,353
50,609
Short-Term Borrowings
50,000
65,000
145,500
Long-Term Debt
60,000
60,000
50,000
Junior Subordinated Debentures
20,620
20,620
20,620
Stockholders' Equity
71,026
73,237
69,096
Profitability and Efficiency
Net Interest Margin
2.70
%
2.63
%
2.87
%
Yield on Earning Assets
4.09
3.90
3.76
Cost of Interest Bearing Liabilities
1.80
1.63
1.17
Book Value Per Share of Common Shares Outstanding
$
25.81
$
26.62
$
25.11
Tangible Book Value Per Share of Common Shares Outstanding
22.03
22.83
21.33
Common Shares Outstanding
2,751,650
2,751,650
2,751,650
Weighted Average Number of Common Shares, Basic
2,751,650
2,751,650
2,751,650
Capital Ratios for the Bank
Tier 1 Core Capital to Average Assets
8.98
%
8.30
%
8.36
%
Common Equity Risk-Based Capital
14.83
14.40
13.51
Tier 1 Risk-Based Capital
14.83
14.40
13.51
Total Risk-Based Capital
16.08
15.65
14.76
About Northway Financial, Inc.
Northway Financial, Inc., headquartered in North Conway, New Hampshire, is a bank holding company. Through its subsidiary bank, Northway Bank, the Company offers a broad range of financial products and services to individuals, businesses, and the public sector from its 17 banking offices and its loan production offices located in Bedford and Portsmouth, New Hampshire.
Forward-looking Statements
Statements included in this press release that are not historical or current fact are “forward-looking statements” made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995 and are subject to certain risks and uncertainties that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. Northway Financial, Inc. disclaims any obligation to subsequently revise any forward-looking statements to reflect events or circumstances after the date of such statements, or to reflect the occurrence of anticipated or unanticipated events or circumstances.
Contact:
Gary Laurash
Chief Financial Officer
603-326-7377
Northway Financial, Inc. is a bank holding company for Northway Bank (the Bank). The Bank is engaged principally in the business of attracting deposits from the general public and investing those deposits in securities, commercial loans, real estate loans and consumer loans. It has six segments. Residential segment offers first lien mortgages and home equity loans. Construction segment offers residential construction and commercial real estate construction loans. Commercial segment offers loans, which are secured primarily by income-producing investor-owned or owner-occupied business properties. Commercial segment offers loans, which are made to businesses and are generally secured by assets of the business. Consumer segment offers automobile and aircraft loans, and repayment is dependent on the credit quality of the individual borrower. Municipal segment offers loans, which are generally unsecured, and repayment is dependent on the tax assessments of the local municipalities.