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Business Wire
29-07-2025
- Business
- Business Wire
Finward Bancorp Announces Second Quarter 2025 Results
MUNSTER, Ind.--(BUSINESS WIRE)--Finward Bancorp (Nasdaq: FNWD) (the 'Bancorp'), the holding company for Peoples Bank (the 'Bank'), today announced that net income available to common stockholders was $2.2 million, or $0.50 per diluted share, for the quarter ended June 30, 2025, as compared to $455 thousand, or $0.11 per diluted share, for the quarter ended March 31, 2025. Selected performance metrics are as follows for the periods presented: 'Our team has been focused on improving core operating results over the past several quarters, and this quarter has begun to show the results of those efforts. Net interest margin expanded for another consecutive quarter and is above 3% on a tax-equivalent basis. Importantly, we have moved Tier 1 capital up above key internal targets, and asset quality has remained relatively stable. Net recoveries were a strong point, and supported overall profitability and credit quality. Seasonal and timing factors impacted operating expense and non-interest income, and we see continued opportunity in both areas as the year moves forward,' said Benjamin Bochnowski, CEO. Highlights of the current period include: Net Interest Margin - The net interest margin for the quarter ended June 30, 2025 was 2.97% compared to 2.81% for the quarter ended March 31, 2025. Net interest margin on a tax-equivalent basis (a non-GAAP measure) for the quarter ended June 30, 2025 was 3.11%, as compared to 2.95% for the quarter ended March 31, 2025. The increased net interest margin from the prior quarter is primarily the result of increased loan yields from repricing, as well as improved funding costs and mix. Funding - As of June 30, 2025, deposits totaled $1.8 billion, an increase of $4.5 million, or 0.3% compared with March 31, 2025 balances, which also totaled $1.8 billion. As of June 30, 2025, non-interest-bearing deposits totaled $271.2 million, a decrease of $10.3 million. Core deposits totaled $1.2 billion at June 30, 2025 and March 31, 2025. Core deposits include checking, savings, and money market accounts and represented 69.1% of the Bancorp's total deposits at June 30, 2025. As of June 30, 2025, balances for certificates of deposit totaled $542.7 million, compared to $544.8 million on March 31, 2025, a decrease of $2.1 million or 0.4%. The increase in total portfolio deposits is primarily related to cyclical flows and continued adjustments to deposit pricing. In addition, as of June 30, 2025, borrowings and repurchase agreements totaled $113.3 million, an increase of $11.6 million or 11.4%, compared to March 31, 2025. The increase in short-term borrowings was the result of cyclical inflows and outflows of interest-earning assets and interest-bearing liabilities. As of June 30, 2025, 71.7% of our deposits are fully FDIC insured, and another 8.0% are further backed by the Indiana Public Deposit Insurance Fund. The Bancorp's liquidity position remains strong with solid core deposit customer relationships, excess cash, debt securities, contractual loan repayments, and access to diversified borrowing sources. As of June 30, 2025, the Bancorp had available liquidity of $728 million including borrowing capacity from the FHLB and Federal Reserve facilities. Securities Portfolio - Securities available for sale balances decreased by $2.3 million to $327.8 million as of June 30, 2025, compared to $330.1 million as of March 31, 2025. The decrease in securities available for sale was primarily due to payoffs of collateralized mortgage obligations and residential mortgage-backed securities within the portfolio. The yield on the securities portfolio increased to 2.42% for the three months ended June 30, 2025 from 2.38% for the three months ended March 31, 2025. Management did not execute any securities sale transactions during the quarter. Lending - The Bank's aggregate loan portfolio totaled $1.5 billion on both June 30, 2025 and March 31, 2025. During the three months ended June 30, 2025, the Bank originated $46.1 million in new commercial loans, compared to $36.7 million during the three months ended March 31, 2025. At June 30, 2025, the Bancorp's portfolio loan balances in commercial real estate owner occupied properties totaled $251.0 million or 16.9% of total loan balances and commercial real estate non-owner occupied properties totaled $299.9 million or 20.1% of total loan balances. Of the $299.9 million in commercial real estate non-owner occupied properties balances, loans collateralized by office buildings represented $42.1 million or 2.8% of total loan balances. Asset Quality - At June 30, 2025, non-performing loans totaled $13.5 million, compared to $12.5 million at March 31, 2025, an increase of $1.0 million or 8.4%. The Bank's ratio of non-performing loans to total loans was 0.91% at June 30, 2025, compared to 0.84% at March 31, 2025. The Bank's ratio of non-performing assets to total assets increased to 0.74% at June 30, 2025 from 0.69% at March 31, 2025. Management maintains a vigilant oversight of nonperforming loans through proactive relationship management. The allowance for credit losses (ACL) on loans totaled $18.2 million at June 30, 2025, or 1.22% of total loans receivable, compared to $17.9 million at March 31, 2025, or 1.20% of total loans receivable, an increase of $229 thousand or 1.3%. The Bank's unused commitment reserve, included in other liabilities, totaled $2.0 million at June 30, 2025, compared to $2.1 million at March 31, 2025, a decrease of $89 thousand or 4.2%. For the quarter ended June 30, 2025, the Bank recorded a net benefit from credit loss totaling $274 thousand based on net loan recoveries, reduction of certain loan and unfunded commitment segment balances, and other factors within the Bank's ACL modeling. The second quarter's benefit consisted of a $185 thousand reversal for credit losses on loans, and a $89 thousand reversal of credit losses on unused commitments. For the quarter ended June 30, 2025, net loan recoveries totaled $414 thousand, compared to net charge-offs of $33 thousand for the quarter ended March 31, 2025. The allowance for credit losses as a percentage of non-performing loans, or coverage ratio, was 133.0% at June 30, 2025, compared to 143.8% at March 31, 2025. Operating Expenses - Non-interest expense as a percentage of average assets was 2.90% for the quarter ended June 30, 2025, as compared to 2.81% for the quarter ended March 31, 2025. The increase in non-interest expenses quarter over quarter was primarily attributable to higher data processing expenses and higher marketing expenses. The Bank remains focused on identifying additional operating efficiencies and third-party expense reductions. Capital Adequacy - As of June 30, 2025, the Bank's tier 1 leverage ratio was 8.69%, an improvement of 0.21% compared to 8.48% at March 31, 2025. The Bank's capital continues to exceed all applicable regulatory capital requirements as set forth in 12 C.F.R. § 324. The Bancorp's tangible book value per share (non-GAAP) was $30.16 at June 30, 2025, up from $29.55 as of March 31, 2025. Tangible common equity to total assets (non-GAAP) was 6.32% at June 30, 2025, up from 6.26% as of March 31, 2025. Excluding accumulated other comprehensive losses, tangible book value per share (non-GAAP) increased to $43.47 as of June 30, 2025, from $43.02 as of March 31, 2025. Disclosures Regarding Non-GAAP Financial Measures Reported amounts are presented in accordance with GAAP. In this press release, the Bancorp also provides certain financial measures identified as non-GAAP. The Bancorp's management believes that the non-GAAP information, which consists of tangible common equity, tangible common equity adjusted for accumulated other comprehensive losses, tangible book value per share, tangible book value per share adjusted for accumulated other comprehensive losses, tangible common equity/total assets, tangible common equity adjusted for other comprehensive loss/total assets, net interest margin on a tax-equivalent basis, and efficiency ratio which can vary from period to period, provides a better comparison of period to period operating performance. The net interest income and net interest margin on a tax-equivalent basis measures recognize the income tax savings when comparing taxable and tax-exempt assets. Interest income and yields on tax-exempt securities and loans are presented using the current federal corporate income tax rate of 21%. Management believes that it is standard practice in the banking industry to present net interest income and net interest margin on a fully tax-equivalent basis and that it may enhance comparability for peer comparison purposes. Additionally, the Bancorp believes this information is utilized by regulators and market analysts to evaluate a company's financial condition and, therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Refer to the "Reconciliation of non-GAAP Financial Measures" below for more information. About Finward Bancorp Finward Bancorp is a locally managed and independent financial holding company headquartered in Munster, Indiana, whose activities are primarily limited to holding the stock of Peoples Bank. Peoples Bank provides a wide range of personal, business, electronic and wealth management financial services from its 26 locations in Lake and Porter Counties in Northwest Indiana and Chicagoland. Finward Bancorp's common stock is quoted on The NASDAQ Stock Market, LLC under the symbol FNWD. The website provides information on Peoples Bank's products and services, and Finward Bancorp's investor relations. Forward Looking Statements This press release may contain forward-looking statements regarding the financial performance, business prospects, growth and operating strategies of the Bancorp. For these statements, the Bancorp claims the protections of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Statements in this communication should be considered in conjunction with the other information available about the Bancorp, including the information in the filings the Bancorp makes with the SEC. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance. The forward-looking statements are based on management's expectations and are subject to a number of risks and uncertainties. Forward-looking statements are typically identified by using words such as 'anticipate,' 'estimate,' 'project,' 'intend,' 'plan,' 'believe,' 'will' and similar expressions in connection with any discussion of future operating or financial performance. Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties that could cause actual results to differ materially include: changes in domestic and international trade policies, including tariffs and other non-tariff barriers, and the effects of such changes on the Bank and its customers; risks related to the development and use of artificial intelligence (AI); the Bank's ability to demonstrate compliance with the terms of the previously disclosed consent order and memorandum of understanding entered into between the Bank and the Federal Deposit Insurance Corporation ('FDIC') and Indiana Department of Financial Institutions ('DFI'), or to demonstrate compliance to the satisfaction of the FDIC and/or DFI within prescribed time frames; the Bank's agreement under the memorandum of understanding to refrain from paying cash dividends without prior regulatory approval; changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates, market liquidity, and capital markets, as well as the magnitude of such changes, which may reduce net interest margins; inflation; further deterioration in the market value of securities held in the Bancorp's investment securities portfolio, whether as a result of macroeconomic factors or otherwise; customer acceptance of the Bancorp's products and services; customer borrowing, repayment, investment, and deposit practices; customer disintermediation; the introduction, withdrawal, success, and timing of business initiatives; competitive conditions; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with mergers, acquisitions, and divestitures; economic conditions; and the impact, extent, and timing of technological changes, capital management activities, regulatory actions by the Federal Deposit Insurance Corporation and Indiana Department of Financial Institutions, and other actions of the Federal Reserve Board and legislative and regulatory actions and reforms. Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in the Bancorp's reports (such as the Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K) filed with the SEC and available at the SEC's Internet website ( All subsequent written and oral forward-looking statements concerning matters attributable to the Bancorp or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. Except as required by law, The Bancorp does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statement is made. In addition to the above factors, we also caution that the actual amounts and timing of any future common stock dividends or share repurchases will be subject to various factors, including our capital position, financial performance, capital impacts of strategic initiatives, market conditions, and regulatory and accounting considerations, as well as any other factors that our Board of Directors deems relevant in making such a determination. Therefore, there can be no assurance that we will repurchase shares or pay any dividends to holders of our common stock, or as to the amount of any such repurchases or dividends. (1) See the reconciliation of these non-GAAP measures to the most directly comparable GAAP measures on pg 13. Expand Average Balances, Interest, Rates Quarter Ended June 30, 2025 March 31, 2025 December 31, 2024 Average Balance Interest Yield/Rate Average Balance Interest Yield/Rate Average Balance Interest Yield/Rate ASSETS Interest bearing deposits in other financial institutions $ 57,749 $ 614 4.25 % $ 53,553 $ 540 4.03 % $ 50,271 $ 650 5.17 % Federal funds sold 868 8 3.69 % 1,375 12 3.49 % 891 9 4.04 % Securities available-for-sale 327,867 1,980 2.42 % 336,060 1,998 2.38 % 343,411 2,011 2.34 % Loans receivable 1,486,861 19,940 5.36 % 1,498,312 19,655 5.25 % 1,504,233 19,802 5.27 % Federal Home Loan Bank stock 6,547 128 7.82 % 6,547 136 8.31 % 6,547 123 7.51 % Total interest earning assets 1,879,892 $ 22,670 4.82 % 1,895,847 $ 22,341 4.71 % 1,905,353 $ 22,595 4.74 % Cash and non-interest bearing deposits in other financial institutions 27,192 27,919 27,360 Allowance for credit losses (18,028 ) (16,946 ) (18,110 ) Other non-interest bearing assets 152,880 153,148 154,707 Total assets $ 2,041,936 $ 2,059,968 $ 2,069,310 LIABILITIES AND STOCKHOLDERS' EQUITY Interest-bearing deposits $ 1,470,225 $ 7,780 2.12 % $ 1,481,377 $ 8,044 2.17 % $ 1,465,198 $ 8,811 2.41 % Repurchase agreements 44,401 368 3.32 % 41,631 349 3.35 % 43,372 396 3.65 % Borrowed funds 58,995 577 3.91 % 61,613 635 4.12 % 72,536 781 4.31 % Total interest bearing liabilities 1,573,621 $ 8,725 2.22 % 1,584,621 $ 9,028 2.28 % 1,581,106 $ 9,988 2.53 % Non-interest bearing deposits 278,620 279,013 289,467 Other non-interest bearing liabilities 37,703 40,923 42,944 Total liabilities 1,889,944 1,904,557 1,913,517 Total stockholders' equity 151,992 155,411 155,793 Total liabilities and stockholders' equity $ 2,041,936 $ 2,059,968 $ 2,069,310 Net interest income $ 13,945 $ 13,313 $ 12,607 Return on average assets 0.42 % 0.09 % 0.41 % Return on average equity 5.66 % 1.17 % 5.39 % Net interest margin 2.97 % 2.81 % 2.65 % Net interest margin, tax-equivalent (non-GAAP) (1) 3.11 % 2.95 % 2.79 % Net interest spread 2.62 % 2.43 % 2.21 % Ratio of interest-earning assets to interest-bearing liabilities 1.19x 1.20x 1.21x Expand (1) See the reconciliation of non-GAAP measures to the most directly comparable GAAP measures on pg 13. Expand Consolidated Balance Sheets As of (Dollars in thousands) 6/30/2025 3/31/2025 12/31/2024 9/30/2024 6/30/2024 ASSETS Cash and non-interest bearing deposits in other financial institutions $ 23,027 $ 18,563 $ 17,883 $ 23,071 $ 19,061 Interest bearing deposits in other financial institutions 79,976 52,829 52,047 48,025 63,439 Federal funds sold 411 975 654 553 707 Total cash and cash equivalents 103,414 72,367 70,584 71,649 83,207 Securities available-for-sale 327,845 330,127 333,554 350,027 339,585 Loans held-for-sale 834 2,849 1,253 2,567 1,185 Loans receivable, net of deferred fees and costs 1,489,486 1,491,696 1,508,976 1,508,242 1,506,398 Less: allowance for credit losses (18,184 ) (17,955 ) (16,911 ) (18,516 ) (18,330 ) Net loans receivable 1,471,302 1,473,741 1,492,065 1,489,726 1,488,068 Federal Home Loan Bank stock 6,547 6,547 6,547 6,547 6,547 Accrued interest receivable 7,651 7,821 7,721 7,442 7,695 Premises and equipment 46,179 46,680 47,259 47,912 48,696 Cash value of bank owned life insurance 33,932 33,712 33,514 33,312 33,107 Goodwill 22,395 22,395 22,395 22,395 22,395 Other intangible assets 1,414 1,635 1,860 2,203 2,555 Other assets 41,470 41,840 43,947 40,882 44,027 Total assets $ 2,062,983 $ 2,039,714 $ 2,060,699 $ 2,074,662 $ 2,077,067 LIABILITIES AND STOCKHOLDERS' EQUITY Deposits: Non-interest bearing $ 271,172 $ 281,461 $ 263,324 $ 285,157 $ 286,784 Interest bearing 1,483,678 1,468,923 1,497,242 1,463,653 1,469,970 Total 1,754,850 1,750,384 1,760,566 1,748,810 1,756,754 Repurchase agreements 48,331 45,053 40,116 43,038 42,973 Borrowed funds 65,000 56,657 65,000 85,000 85,000 Accrued expenses and other liabilities 40,549 35,813 43,603 38,259 43,709 Total liabilities 1,908,730 1,887,907 1,909,285 1,915,107 1,928,436 Stockholders' Equity: Preferred stock, no par or stated value; 10,000,000 shares authorized, none outstanding - - - - - Common stock, no par or stated value; 10,000,000 shares authorized (1) - - - - - Additional paid-in capital 70,263 70,132 70,034 69,916 69,778 Accumulated other comprehensive loss (57,560 ) (58,244 ) (58,084 ) (48,241 ) (58,939 ) Retained earnings 141,550 139,919 139,464 137,880 137,792 Total stockholders' equity 154,253 151,807 151,414 159,555 148,631 Total liabilities and stockholders' equity $ 2,062,983 $ 2,039,714 $ 2,060,699 $ 2,074,662 $ 2,077,067 Expand (1) Shares of common stock issued and outstanding were at 4,324,889 at 6/30/2025; 4,324,485 at 3/31/2025; 4,313,698 at 12/31/24; 4,313,940 at 9/30/24; and 4,313,940 at 6/30/24. Expand Consolidated Statements of Income Quarter Ended (Dollars in thousands, except per share data) 6/30/2025 3/31/2025 12/31/2024 9/30/2024 6/30/2024 Loans $ 19,940 $ 19,655 $ 19,802 $ 19,660 $ 19,174 Securities & short-term investments 2,730 2,686 2,793 2,812 2,953 Total interest income 22,670 22,341 22,595 22,472 22,127 Interest expense: Deposits 7,780 8,045 8,812 8,946 8,610 Borrowings 945 983 1,176 1,520 1,463 Total interest expense 8,725 9,028 9,988 10,466 10,073 Net interest income 13,945 13,313 12,607 12,006 12,054 Provision for (benefit from) credit losses (274 ) 454 (579 ) - 76 Net interest income after provision for credit losses 14,219 12,859 13,186 12,006 11,978 Non-interest income: Fees and service charges 1,330 1,109 1,439 1,463 1,257 Wealth management operations 696 619 728 731 763 Gain on tax credit investment - 67 1,236 - - Gain on sale of loans held-for-sale, net 378 230 328 338 320 Increase in cash value of bank owned life insurance 220 198 202 205 212 Gain (loss) on sale of real estate - - (212 ) - 15 Other 59 6 11 130 6 Total non-interest income 2,683 2,229 3,732 2,867 2,573 Non-interest expense: Compensation and benefits 7,313 7,372 6,628 6,963 7,037 Occupancy and equipment 1,935 2,111 2,045 2,181 2,116 Data processing 1,341 1,039 1,202 1,165 1,135 Federal deposit insurance premiums 471 433 457 435 397 Marketing 214 86 220 209 212 Professional and outside services 1,115 1,260 1,341 1,251 1,257 Technology 545 454 509 602 507 Other 1,852 1,717 1,845 1,668 1,756 Total non-interest expense 14,786 14,472 14,247 14,474 14,417 Income before income taxes 2,116 616 2,671 399 134 Income tax expenses (benefit) (35 ) 161 569 (207 ) (9 ) Net income $ 2,151 $ 455 $ 2,102 $ 606 $ 143 Earnings per common share: Diluted $ 0.50 $ 0.11 $ 0.49 $ 0.14 $ 0.03 Expand Consolidated Statements of Income (cont'd) Six Months Ended (Dollars in thousands, except per share data) 6/30/2025 6/30/2024 Interest income: Loans $ 39,595 $ 38,053 Securities & short-term investments 5,416 6,058 Total interest income 45,011 44,111 Interest expense: Deposits 15,825 17,404 Borrowings 1,928 2,873 Total interest expense 17,753 20,277 Net interest income 27,258 23,834 Provision for credit losses 180 76 Net interest income after provision for credit losses 27,078 23,758 Non-interest income: Fees and service charges 2,439 2,410 Wealth management operations 1,315 1,396 Gain on tax credit investment 67 - Gain on sale of loans held-for-sale, net 608 472 Increase in cash value of bank owned life insurance 418 405 Gain on sale of real estate - 11,873 Loss on sale of securities, net - (531 ) Other 65 24 Total non-interest income 4,912 16,049 Non-interest expense: Compensation and benefits 14,685 14,146 Occupancy and equipment 4,046 4,024 Data processing 2,380 2,305 Federal deposit insurance premiums 904 898 Marketing 300 370 Professional and outside services 2,375 2,814 Technology 999 1,132 Other 3,569 3,732 Total non-interest expense 29,258 29,421 Income before income taxes 2,732 10,386 Income tax expenses 126 963 Net income $ 2,606 $ 9,423 Earnings per common share: Basic $ 0.61 $ 2.21 Diluted $ 0.61 $ 2.21 Expand Loans As of (Dollars in thousands) 6/30/2025 3/31/2025 12/31/2024 9/30/2024 6/30/2024 6/30/2025 vs 3/31/2025 6/30/2025 vs 6/30/2024 Residential real estate $ 456,256 $ 458,424 $ 467,293 $ 471,156 $ 475,371 $ (2,168 ) (0.5 )% $ (19,115 ) (4.0 )% Home equity 51,112 49,752 49,758 49,106 48,435 1,360 2.7 % 2,677 5.5 % Commercial real estate 551,091 554,866 551,674 539,972 529,421 (3,775 ) (0.7 )% 21,670 4.1 % Construction and land development 74,895 86,728 82,874 87,923 88,699 (11,833 ) (13.6 )% (13,804 ) (15.6 )% Multifamily 206,540 204,964 212,455 218,037 219,841 1,576 0.8 % (13,301 ) (6.1 )% Commercial business 105,636 99,519 104,246 97,900 98,402 6,117 6.1 % 7,234 7.4 % Consumer 2,347 504 551 522 611 1,843 365.7 % 1,736 284.1 % Manufactured homes 25,146 25,762 26,708 27,462 28,721 (616 ) (2.4 )% (3,575 ) (12.4 )% Government 14,628 9,279 11,024 12,969 14,014 5,349 57.6 % 614 4.4 % Loans receivable 1,487,651 1,489,798 1,506,583 1,505,047 1,503,515 (2,147 ) (0.1 )% (15,864 ) (1.1 )% Net deferred loan origination costs 2,012 2,209 2,439 2,606 3,054 (197 ) (8.9 )% (1,042 ) (34.1 )% Loan clearing funds (177 ) (311 ) (46 ) 589 (171 ) 134 (43.1 )% (6 ) 3.5 % Loans receivable, net $ 1,489,486 $ 1,491,696 $ 1,508,976 $ 1,508,242 $ 1,506,398 $ (2,210 ) (0.1 )% $ (16,912 ) (1.1 )% Expand Deposits As of (Dollars in thousands) 6/30/2025 3/31/2025 12/31/2024 9/30/2024 6/30/2024 6/30/2025 vs 3/31/2025 6/30/2025 vs 6/30/2024 Checking $ 593,471 $ 589,403 $ 591,487 $ 579,132 $ 603,730 $ 4,068 0.7 % $ (10,259 ) (1.7 )% Savings 266,070 274,028 275,121 279,126 288,920 (7,958 ) (2.9 )% (22,850 ) (7.9 )% Money market 352,616 342,106 333,705 328,329 322,939 10,510 3.1 % 29,677 9.2 % Certificates of deposit 542,693 544,847 560,253 562,223 541,165 (2,154 ) (0.4 )% 1,528 0.3 % Total deposits $ 1,754,850 $ 1,750,384 $ 1,760,566 $ 1,748,810 $ 1,756,754 $ 4,466 0.3 % $ (1,904 ) (0.1 )% Expand Asset Quality As of and for the Quarter Ended (Dollars in thousands) 6/30/2025 3/31/2025 12/31/2024 9/30/2024 6/30/2024 Non-accruing loans $ 13,526 $ 12,483 $ 13,738 $ 13,806 $ 11,079 Accruing loans delinquent more than 90 days 145 - - - 294 Securities in non-accrual 1,616 1,630 1,419 1,440 1,371 Total nonperforming assets $ 15,287 $ 14,113 $ 15,157 $ 15,246 $ 12,744 Allowance for credit losses (ACL): ACL specific allowances for collateral dependent loans $ 570 $ 259 $ 284 $ 1,821 $ 1,327 ACL general allowances for loan portfolio 17,614 17,696 16,627 16,695 17,003 Total ACL $ 18,184 $ 17,955 $ 16,911 $ 18,516 $ 18,330 Expand Expand (1) Current quarter ratios are estimated. Expand Reconciliation of Non-GAAP Performance Measures Quarter Ended (Dollars in thousands, except per share amounts) 6/30/2025 3/31/2025 12/31/2024 9/30/2024 6/30/2024 Tangible Common Ratios Stockholder's equity (GAAP) $ 154,253 $ 151,807 $ 151,414 $ 159,555 $ 148,631 Less: Goodwill (GAAP) (22,395 ) (22,395 ) (22,395 ) (22,395 ) (22,395 ) Less: Other intangibles (GAAP) (1,414 ) (1,635 ) (1,860 ) (2,203 ) (2,555 ) Tangible common equity (non-GAAP) $ 130,444 $ 127,777 $ 127,159 $ 134,957 $ 123,681 Add: Accumulated other comprehensive loss (GAAP) 57,560 58,244 58,084 48,241 58,939 Tangible common equity adjusted for accumulated other comprehensive loss (non-GAAP) (1) $ 188,004 $ 186,021 $ 185,243 $ 183,198 $ 182,620 Total assets (GAAP) $ 2,062,983 $ 2,039,714 $ 2,060,699 $ 2,077,067 $ 2,071,782 Shares outstanding - end of quarter 4,324,889 4,324,485 4,313,698 4,313,940 4,313,940 Common book value per share (GAAP) $ 35.67 $ 35.10 $ 35.10 $ 36.99 $ 34.45 Tangible common book value per share (non-GAAP) $ 30.16 $ 29.55 $ 29.48 $ 31.28 $ 28.67 Tangible common book value per share adjusted for accumulated other comprehensive loss (non-GAAP) $ 43.47 $ 43.02 $ 42.94 $ 42.47 $ 42.33 Total equity to total assets (GAAP) 7.48 % 7.44 % 7.35 % 7.69 % 7.16 % Tangible common equity to total assets (non-GAAP) 6.32 % 6.26 % 6.17 % 6.51 % 5.95 % Tangible common equity adjusted for accumulated other comprehensive loss to total assets (non-GAAP) 9.11 % 9.12 % 8.99 % 8.83 % 8.79 % Calculation of net interest margin, taxable-equivalent basis Net interest income (GAAP) $ 13,945 $ 13,313 $ 12,607 $ 12,006 $ 12,054 Tax-equivalent adjustment on securities and loans (2) 674 670 674 678 677 Net interest income (tax-equivalent basis) $ 14,619 $ 13,983 $ 13,281 $ 12,684 $ 12,731 Total average earning assets $ 1,879,892 $ 1,895,847 $ 1,905,333 $ 1,910,731 $ 1,906,998 Net interest margin 2.97 % 2.81 % 2.65 % 2.53 % 2.53 % Net interest margin (tax-equivalent basis) 3.11 % 2.95 % 2.79 % 2.66 % 2.67 % Efficiency ratio Total non-interest expense $ 14,786 $ 14,472 $ 14,247 $ 14,474 $ 14,417 Total revenue 16,628 15,542 16,339 14,873 14,627 Efficiency ratio 88.92 % 93.11 % 87.20 % 97.32 % 98.56 % Expand (1) Tangible common equity adjusted for accumulated other comprehensive loss is a non-GAAP financial measure used by management to evaluate the Company's capital position without the impact of unrealized losses recorded in accumulated other comprehensive loss. This measure adjusts tangible common equity by adding back unrealized losses included in accumulated other comprehensive loss. (2) The tax equivalent adjustment represents the increase in net interest income needed to reflect the tax-exempt income from certain investment securities and loans on tax-equivalent basis using a federal statutory corporate rate of 21%. Expand
Associated Press
28-01-2025
- Business
- Associated Press
Finward Bancorp Announces Earnings for the Quarter and Twelve Months Ended December 31, 2024
MUNSTER, Ind., Jan. 28, 2025 (GLOBE NEWSWIRE) -- Finward Bancorp (Nasdaq: FNWD) (the 'Bancorp'), the holding company for Peoples Bank (the 'Bank'), today announced that net income available to common stockholders was $12.1 million, or $2.84 per diluted share, for the twelve months ended December 31, 2024, as compared to $8.4 million, or $1.96 per diluted share, for the corresponding prior year period. For the three months ended December 31, 2024, the Bancorp's net income totaled $2.1 million, or $0.49 per diluted share, as compared to $606 thousand, or $0.14 per diluted share, for the three months ended September 30, 2024, and as compared to $1.5 million, or $0.35 per diluted share, for the three months ended December 31, 2023. Selected performance metrics are as follows for the periods presented: Performance Ratios Quarter ended, Twelve months ended, (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) December 31, September 30, June 30, March 31, December 31, December 31, December 31, 2024 2024 2024 2024 2023 2024 2023 Return on equity 5.39% 1.60% 0.39% 24.97% 4.92% 8.06% 6.28% Return on assets 0.41% 0.12% 0.03% 1.77% 0.29% 0.58% 0.40% Tax adjusted net interest margin (Non-GAAP) 2.79% 2.66% 2.67% 2.57% 2.80% 2.68% 2.98% Noninterest income / average assets 0.72% 0.55% 0.50% 2.57% 0.53% 1.09% 0.52% Noninterest expense / average assets 2.75% 2.80% 2.79% 2.86% 2.60% 2.80% 2.65% Efficiency ratio 87.20% 97.32% 98.56% 59.41% 87.49% 81.78% 84.58% 'The Bank ended the year with continued improvement in its overall positioning and increased momentum for 2025,' said Benjamin Bochnowski, chief executive officer. 'We improved regulatory capital throughout the year through balance sheet management and earnings and had the benefit of one-time income including our sale leaseback transaction early in the year and a gain on a long-held tax credit investment this past quarter. Net interest margin improved throughout 2024 as expected, based on our earning asset position and reduced funding costs driven by recent Federal Reserve interest rate policy,' he continued. 'The Bank charged off a small number of commercial business loans in the 4th quarter, and management will continue to actively manage credit quality,' he concluded. Highlights of the current period include: Net Interest Margin - The net interest margin for the three months ended December 31, 2024, was 2.65%, compared to 2.51% for the three months ended September 30, 2024. The tax-adjusted net interest margin (a non-GAAP measure) for the three months ended December 31, 2024, was 2.79%, compared to 2.66% for the three months ended September 30, 2024. The net interest margin for the twelve months ended December 31, 2024, was 2.54%, compared to 2.83% for the twelve months ended December 31, 2023. The tax-adjusted net interest margin (a non-GAAP measure) for the twelve months ended December 31, 2024, was 2.68%, compared to 2.98% for the twelve months ended December 31, 2023. The increased net interest margin for the three months ended December 31, 2024 compared to September 30, 2024 is primarily the result of increased yields on the Bank's loan portfolio, combined with reduced deposit and borrowing costs as a result of the Federal Reserve's continued reduction of federal funds rates during the quarter. See Table 1 at the end of this press release for a reconciliation of the tax-adjusted net interest margin to the GAAP net interest margin. Funding - As of December 31, 2024, deposits totaled $1.8 billion, an increase of $11.8 million or 0.7%, compared to September 30, 2024. As of December 31, 2024, non-interest-bearing deposits totaled $263.3 million, a decrease of $21.8 million or 7.7%, compared to September 30, 2024. Core deposits totaled $1.2 billion at both December 31, 2024, and September 30, 2024. Core deposits include checking, savings, and money market accounts and represented 68.2% of the Bancorp's total deposits at December 31, 2024. As of December 31, 2024, balances for certificates of deposit totaled $560.3 million, compared to $562.2 million on September 30, 2024, a decrease of $2.0 million or 0.4%. The increase in total portfolio deposits is primarily related to cyclical flows and continued adjustments to deposit pricing. The decrease in non-interest-bearing deposits is primarily attributable to regular outflow of business-related checking deposits at year-end which tend to return in subsequent periods. In addition, as of December 31, 2024, borrowings and repurchase agreements totaled $105.0 million, a decrease of $22.9 million or 17.9%, compared to September 30, 2024. The decrease in short-term borrowings was the result of cyclical inflows and outflows of interest-earning assets and interest-bearing liabilities. As of December 31, 2024, 72% of our deposits are fully FDIC insured, and another 9% are further backed by the Indiana Public Deposit Insurance Fund. The Bancorp's liquidity position remains strong with solid core deposit customer relationships, excess cash, debt securities, contractual loan repayments, and access to diversified borrowing sources. As of December 31, 2024, the Bancorp had available liquidity of $687 million including borrowing capacity from the FHLB and Federal Reserve facilities. Securities Portfolio - Securities available for sale balances decreased by $16.5 million to $333.6 million as of December 31, 2024, compared to $350.0 million as of September 30, 2024. The decrease in securities available for sale was due to a combination of portfolio runoff and an increase of accumulated other comprehensive loss ('AOCL'). AOCL was $58.1 million as of December 31, 2024, compared to $48.2 million on September 30, 2024, a decline of $9.8 million, or 20.4%. The yield on the securities portfolio decreased to 2.34% for the three months ended December 31, 2024, down from 2.37% for the three months ended September 30, 2024. Management did not execute any securities sale transactions during the quarter but will continue to monitor the securities portfolio for additional restructuring opportunities. Lending - The Bank's aggregate loan portfolio totaled $1.5 billion on both December 31, 2024, and September 30, 2024. During the three months ended December 31, 2024, the Bank originated $59.2 million in new commercial loans, compared to $70.4 million during the three months ended September 30, 2024, and $47.5 million during the three months ended December 31, 2023. The loan portfolio represents 79.3% of earning assets and is comprised of 63.0% commercial-related credits. At December 31, 2024, the Bancorp's portfolio loan balances in commercial real estate owner occupied properties totaled $246.6 million or 16.3% of total loan balances and commercial real estate non-owner-occupied properties totaled $305.1 million or 20.2% of total loan balances. Of the $305.1 million in commercial real estate non-owner-occupied properties balances, loans collateralized by office buildings represented $38.5 million or 2.5% of total loan balances. Gain on Sale of Loans - Gains from the sale of loans totaled $1.1 million for both the twelve months ended December 31, 2024, and 2023. During the twelve months ended December 31, 2024, the Bank originated $36.8 million in new fixed rate mortgage loans for sale, compared to $38.0 million during the twelve months ended December 31, 2023. During the twelve months ended December 31, 2024, the Bank originated $27.4 million in new 1-4 family loans retained in its portfolio, compared to $41.6 million during the twelve months ended December 31, 2023. Total 1-4 family originations for the quarter ended December 31, 2024, totaled $25.4 million, an increase of $5.3 million compared to $20.1 million for the quarter ended September 30, 2024. The retained loans are primarily construction loans and adjustable-rate loans with a fixed-rate period of 7 years or less. The Bank continues to sell longer-duration fixed rate mortgages into the secondary market. Gain on Tax Credit Investment - During the three months ended December 31, 2024, the Bank successfully concluded a long term, non-controlling interest in a partnership established to facilitate tax credit investments. Upon the termination of the partnership, the Bank recognized a one-time gain of $1.2 million recognized through noninterest income. The proceeds from the dissolution of this tax credit investment will contribute to the Bank's financial position, thereby supporting ongoing strategic initiatives and operational priorities. Asset Quality - At December 31, 2024, non-performing loans totaled $13.7 million, compared to $13.8 million at September 30, 2024, a decrease of $68 thousand or 0.5%. The Bank's ratio of non-performing loans to total loans was 0.91% at December 31, 2024, compared to 0.92% at September 30, 2024. The Bank's ratio of non-performing assets to total assets was 0.74% at December 31, 2024, compared to 0.73% at September 30, 2024. Management maintains a vigilant oversight of nonperforming loans through proactive relationship management. The allowance for credit losses (ACL) on loans totaled $16.9 million at December 31, 2024, or 1.12% of total loans receivable, compared to $18.5 million at September 30, 2024, or 1.23% of total loans receivable, a decrease of $1.6 million or 8.7% and is considered adequate by management. The Bank's unused commitment reserve, included in other liabilities, totaled $2.7 million at December 31, 2024, compared to $3.9 million at September 30, 2024, a decrease of $1.2 million or 30%. For the quarter ended December 31, 2024, the Bank recorded a net negative provision for credit loss expense totaling $579 thousand based on a decline in individually assessed loans balances, historical loss rate updates, migration of loan and unfunded commitment segment balances, and other factors within the Bank's ACL modeling. The fourth quarter's provision expense consisted of a $597 thousand provision for credit losses on loans, and a $1.2 million reversal of provision for credit losses on unused commitments. The decrease in the Bank's unused commitment reserve was primarily due to reduced unused commitment balances and other factors. For the quarter ended December 31, 2024, net charge-offs, totaled $2.2 million. Most of these charge-offs involved a small number of commercial or multifamily-related loans which were previously monitored and had specific allocations toward individual impairment or contributed to higher expected loss rates within the Bank's prior ACL balance. For the quarter ended September 30, 2024, the Bank recorded no provision expense and recoveries, net of charge-offs, totaled $186 thousand. The ACL as a percentage of non-performing loans, or coverage ratio, was 123.1% at December 31, 2024 compared to 134.1% at September 30, 2024. Operating Expenses - Non-interest expense as a percentage of average assets was 2.75% for the quarter ended December 31, 2024, as compared to 2.80% for the quarter ended September 30, 2024. Decreases in non-interest expenses quarter over quarter were primarily attributable to reduced compensation and benefit expenses, and lower occupancy and equipment expenses. The Bank remains focused on identifying additional operating efficiencies and third-party expense reductions. Compensation and benefits expense is up 0.3% for the twelve months ended December 31, 2024, compared to December 31, 2023. Capital Adequacy - As of December 31, 2024, the Bank's tier 1 capital to adjusted average assets ratio was 8.46%, an improvement of 0.08% compared to 8.38% at September 30, 2024. The Bank's capital continues to exceed all applicable regulatory capital requirements as set forth in 12 C.F.R. § 324. The Bancorp's tangible book value per share was $29.48 at December 31, 2024, down from $31.28 as of September 30, 2024 (a non-GAAP measure). Tangible common equity to total assets was 6.17% at December 31, 2024, down from 6.51% as of September 30, 2024 (a non-GAAP measure). Excluding accumulated other comprehensive losses, tangible book value per share increased to $42.94 as of December 31, 2024, from $42.47 as of September 30, 2024 (a non-GAAP measure). See Table 1 at the end of this press release for a reconciliation of the tangible book value per share, tangible book value per share adjusted for other accumulated comprehensive losses, tangible common equity as a percentage of total assets, and tangible common equity as a percentage of total assets adjusted for accumulated other comprehensive losses to the related GAAP ratios. Disclosures Regarding Non-GAAP Financial Measures Reported amounts are presented in accordance with GAAP. In this press release, the Bancorp also provides certain financial measures identified as non-GAAP. The Bancorp's management believes that the non-GAAP information, which consists of tangible common equity, tangible common equity adjusted for accumulated other comprehensive losses, tangible book value per share, tangible book value per share adjusted for accumulated other comprehensive losses, tangible common equity/total assets, tax-adjusted net interest margin, and efficiency ratio, which can vary from period to period, provides a better comparison of period to period operating performance. The adjusted net interest income and tax-adjusted net interest margin measures recognize the income tax savings when comparing taxable and tax-exempt assets. Interest income and yields on tax-exempt securities and loans are presented using the current federal income tax rate of 21%. Management believes that it is standard practice in the banking industry to present net interest income and net interest margin on a fully tax-equivalent basis and that it may enhance comparability for peer comparison purposes. Additionally, the Bancorp believes this information is utilized by regulators and market analysts to evaluate a company's financial condition and, therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Refer to Table 1 – Reconciliation of Non-GAAP Financial Measures at the end of this document for a reconciliation of the non-GAAP measures identified herein and their most comparable GAAP measures. About Finward Bancorp Finward Bancorp is a locally managed and independent financial holding company headquartered in Munster, Indiana, whose activities are primarily limited to holding the stock of Peoples Bank. Peoples Bank provides a wide range of personal, business, electronic and wealth management financial services from its 26 locations in Lake and Porter Counties in Northwest Indiana and Chicagoland. Finward Bancorp's common stock is quoted on The NASDAQ Stock Market, LLC under the symbol FNWD. The website provides information on Peoples Bank's products and services, and Finward Bancorp's investor relations. Forward Looking Statements This press release may contain forward-looking statements regarding the financial performance, business prospects, growth and operating strategies of the Bancorp. For these statements, the Bancorp claims the protections of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Statements in this communication should be considered in conjunction with the other information available about the Bancorp, including the information in the filings the Bancorp makes with the SEC. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance. The forward-looking statements are based on management's expectations and are subject to a number of risks and uncertainties. Forward-looking statements are typically identified by using words such as 'anticipate,' 'estimate,' 'project,' 'intend,' 'plan,' 'believe,' 'will' and similar expressions in connection with any discussion of future operating or financial performance. Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties that could cause actual results to differ materially include: the Bank's ability to demonstrate compliance with the terms of the previously disclosed consent order and memorandum of understanding entered into between the Bank and the Federal Deposit Insurance Corporation ('FDIC') and Indiana Department of Financial Institutions ('DFI'), or to demonstrate compliance to the satisfaction of the FDIC and/or DFI within prescribed time frames; the Bank's agreement under the memorandum of understanding to refrain from paying cash dividends without prior regulatory approval; changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates, market liquidity, and capital markets, as well as the magnitude of such changes, which may reduce net interest margins; the aggregate effects of inflation experienced in recent years; further deterioration in the market value of securities held in the Bancorp's investment securities portfolio, whether as a result of macroeconomic factors or otherwise; customer acceptance of the Bancorp's products and services; customer borrowing, repayment, investment, and deposit practices; customer disintermediation; the introduction, withdrawal, success, and timing of business initiatives; competitive conditions; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with mergers, acquisitions, and divestitures; economic conditions; and the impact, extent, and timing of technological changes, capital management activities, regulatory actions by the Federal Deposit Insurance Corporation and Indiana Department of Financial Institutions, and other actions of the Federal Reserve Board and legislative and regulatory actions and reforms. Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in the Bancorp's reports (such as the Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K) filed with the SEC and available at the SEC's Internet website ( All subsequent written and oral forward-looking statements concerning matters attributable to the Bancorp or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. Except as required by law, The Bancorp does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statement is made. In addition to the above factors, we also caution that the actual amounts and timing of any future common stock dividends or share repurchases will be subject to various factors, including our capital position, financial performance, capital impacts of strategic initiatives, market conditions, and regulatory and accounting considerations, as well as any other factors that our Board of Directors deems relevant in making such a determination. Therefore, there can be no assurance that we will repurchase shares or pay any dividends to holders of our common stock, or as to the amount of any such repurchases or dividends. Finward Bancorp Quarterly Financial Report Performance Ratios Quarter ended, Twelve months ended, (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) December 31, September 30, June 30, March 31, December 31, December 31, December 31, 2024 2024 2024 2024 2023 2024 2023 Return on equity 5.39 % 1.60 % 0.39 % 24.97 % 4.92 % 8.06 % 6.28 % Return on assets 0.41 % 0.12 % 0.03 % 1.77 % 0.29 % 0.58 % 0.40 % Yield on loans 5.27 % 5.22 % 5.11 % 5.02 % 5.09 % 5.15 % 4.92 % Yield on security investments 2.34 % 2.37 % 2.43 % 2.37 % 2.57 % 2.38 % 2.43 % Total yield on earning assets 4.74 % 4.70 % 4.64 % 4.52 % 4.64 % 4.67 % 4.45 % Cost of interest-bearing deposits 2.41 % 2.47 % 2.37 % 2.36 % 2.22 % 2.40 % 1.74 % Cost of repurchase agreements 3.65 % 4.04 % 3.86 % 3.88 % 3.78 % 3.85 % 3.64 % Cost of borrowed funds 4.31 % 4.56 % 4.95 % 4.62 % 4.41 % 4.62 % 4.55 % Total cost of interest-bearing liabilities 2.53 % 2.63 % 2.55 % 2.53 % 2.38 % 2.56 % 1.96 % Tax adjusted net interest margin (Non-GAAP) 2.79 % 2.66 % 2.67 % 2.57 % 2.80 % 2.68 % 2.98 % Noninterest income / average assets 0.72 % 0.55 % 0.50 % 2.57 % 0.53 % 1.09 % 0.52 % Noninterest expense / average assets 2.75 % 2.80 % 2.79 % 2.86 % 2.60 % 2.80 % 2.65 % Net noninterest margin / average assets -2.03 % -2.24 % -2.29 % -0.29 % -2.08 % -1.71 % -2.14 % Efficiency ratio 87.20 % 97.32 % 98.56 % 59.41 % 87.49 % 81.78 % 84.58 % Effective tax rate 21.30 % -51.88 % -6.72 % 9.48 % -30.85 % 9.85 % -4.16 % Non-performing assets to total assets 0.74 % 0.73 % 0.61 % 0.64 % 0.61 % 0.74 % 0.61 % Non-performing loans to total loans 0.91 % 0.92 % 0.75 % 0.78 % 0.76 % 0.91 % 0.76 % Allowance for credit losses to non-performing loans 123.10 % 134.12 % 161.17 % 159.12 % 163.90 % 123.10 % 163.90 % Allowance for credit losses to loans receivable 1.12 % 1.23 % 1.22 % 1.25 % 1.24 % 1.12 % 1.24 % Foreclosed real estate to total assets 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % Basic earnings per share $ 0.49 $ 0.14 $ 0.03 $ 2.18 $ 0.36 $ 2.85 $ 1.96 Diluted earnings per share $ 0.49 $ 0.14 $ 0.03 $ 2.17 $ 0.35 $ 2.84 $ 1.96 Stockholders' equity / total assets 7.35 % 7.69 % 7.16 % 7.32 % 6.99 % 7.35 % 6.99 % Book value per share $ 35.10 $ 36.99 $ 34.45 $ 35.17 $ 34.28 $ 35.10 $ 34.28 Closing stock price $ 28.11 $ 31.98 $ 24.52 $ 24.60 $ 25.24 $ 28.11 $ 25.24 Price to earnings per share ratio 14.25 56.21 182.60 2.82 17.77 9.87 12.87 Dividends declared per common share $ 0.12 $ 0.12 $ 0.12 $ 0.12 $ 0.12 $ 0.48 $ 1.05 Bank Level Capital Common equity tier 1 capital to risk-weighted assets 11.32 % 11.10 % 10.94 % 10.89 % 10.43 % 11.32 % 10.43 % Tier 1 capital to risk-weighted assets 11.32 % 11.10 % 10.94 % 10.89 % 10.43 % 11.32 % 10.43 % Total capital to risk-weighted assets 12.26 % 12.14 % 11.95 % 11.92 % 11.36 % 12.26 % 11.36 % Tier 1 capital to adjusted average assets 8.46 % 8.38 % 8.32 % 8.24 % 7.78 % 8.46 % 7.78 % Non-GAAP Performance Ratios Quarter ended, Twelve months ended, (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) December 31, September 30, June 30, March 31, December 31, December 31, December 31, 2024 2024 2024 2024 2023 2024 2023 Net interest margin - tax equivalent 2.79 % 2.66 % 2.67 % 2.57 % 2.80 % 2.68 % 2.98 % Tangible book value per diluted share $ 29.48 $ 31.28 $ 28.67 $ 29.30 $ 28.31 $ 29.48 $ 28.31 Tangible book value per diluted share adjusted for AOCL $ 42.94 $ 42.47 $ 42.33 $ 42.36 $ 40.31 $ 42.94 $ 40.31 Tangible common equity to total assets 6.17 % 6.51 % 5.95 % 6.09 % 5.77 % 6.17 % 5.77 % Tangible common equity to total assets adjusted for AOCL 8.99 % 8.83 % 8.79 % 8.81 % 8.22 % 8.99 % 8.22 % (1) Tax adjusted net interest margin represents a non-GAAP financial measure. See the non-GAAP reconciliation table section captioned 'Non-GAAP Financial Measures' for further disclosure regarding non-GAAP financial measures Quarter Ended (Dollars in thousands) Average Balances, Interest, and Rates (unaudited) December 31, 2024 September 30, 2024 Average Balance Interest Rate (%) Average Balance Interest Rate (%) ASSETS Interest bearing deposits in other financial institutions $ 50,271 $ 650 5.17 $ 54,084 $ 665 4.92 Federal funds sold 891 9 4.04 682 9 5.28 Securities available-for-sale 343,411 2,011 2.34 342,451 2,031 2.37 Loans receivable 1,504,233 19,802 5.27 1,506,967 19,660 5.22 Federal Home Loan Bank stock 6,547 123 7.51 6,547 107 6.54 Total interest earning assets 1,905,353 $ 22,595 4.74 1,910,731 $ 22,472 4.70 Cash and non-interest bearing deposits in other financial institutions 27,360 22,478 Allowance for credit losses (18,110) (18,482) Other noninterest bearing assets 154,707 155,997 Total assets $ 2,069,310 $ 2,070,724 LIABILITIES AND STOCKHOLDERS' EQUITY Interest-bearing deposits $ 1,465,198 $ 8,811 2.41 $ 1,451,414 $ 8,946 2.47 Repurchase agreements 43,372 396 3.65 43,074 435 4.04 Borrowed funds 72,536 781 4.31 95,224 1,085 4.56 Total interest bearing liabilities 1,581,106 $ 9,988 2.53 1,589,712 $ 10,466 2.63 Non-interest bearing deposits 289,467 287,507 Other noninterest bearing liabilities 42,944 41,696 Total liabilities 1,913,517 1,918,915 Total stockholders' equity 155,793 151,809 Total liabilities and stockholders' equity $ 2,069,310 $ 2,070,724 Net interest income $ 12,607 $ 12,006 Return on average assets 0.41 % 0.12 % Return on average equity 5.39 % 1.60 % Net interest margin (average earning assets) 2.65 % 2.51 % Net interest margin (average earning assets) - tax equivalent 2.79 % 2.66 % Net interest spread 2.21 % 2.07 % Ratio of interest-earning assets to interest-bearing liabilities 1.21 x 1.20 x Year-to-Date (Dollars in thousands) Average Balances, Interest, and Rates (unaudited) December 31, 2024 September 30, 2024 Average Balance Interest Rate (%) Average Balance Interest Rate (%) ASSETS ` Interest bearing deposits in other financial institutions $ 51,202 $ 2,967 5.79 $ 61,107 $ 2,317 5.06 Federal funds sold 912 38 4.17 919 29 4.21 Securities available-for-sale 347,048 8,250 2.38 348,269 6,239 2.39 Loans receivable 1,504,206 77,515 5.15 1,504,197 57,713 5.12 Federal Home Loan Bank stock 6,547 408 6.23 6,547 285 5.80 Total interest earning assets 1,909,915 $ 89,178 4.67 1,921,039 $ 66,583 4.62 Cash and non-interest bearing deposits in other financial institutions 28,730 19,598 Allowance for credit losses (18,529) (18,670) Other noninterest bearing assets 155,251 155,433 Total assets $ 2,075,367 $ 2,077,400 LIABILITIES AND STOCKHOLDERS' EQUITY Interest-bearing deposits $ 1,462,039 $ 35,161 2.40 $ 1,464,682 $ 26,350 2.40 Repurchase agreements 41,506 1,600 3.85 40,879 1,204 3.93 Borrowed funds 85,927 3,970 4.62 90,423 3,189 4.70 Total interest bearing liabilities 1,589,472 $ 40,731 2.56 1,595,984 $ 30,743 2.57 Non-interest bearing deposits 293,508 291,161 Other noninterest bearing liabilities 41,893 41,540 Total liabilities 1,924,873 1,928,685 Total stockholders' equity 150,494 148,715 Total liabilities and stockholders' equity $ 2,075,367 $ 2,077,400 Net interest income $ 48,447 $ 35,840 Return on average assets 0.58 % 0.64 % Return on average equity 8.06 % 4.50 % Net interest margin (average earning assets) 2.54 % 2.49 % Net interest margin (average earning assets) - tax equivalent 2.68 % 2.63 % Net interest spread 2.11 % 2.05 % Ratio of interest-earning assets to interest-bearing liabilities 1.20 x 1.20 x Finward Bancorp Quarterly Financial Report Balance Sheet Data (Dollars in thousands) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) December 31, September 30, June 30, March 31, December 31, 2024 2024 2024 2024 2023 ASSETS Cash and non-interest bearing deposits in other financial institutions $ 17,883 $ 23,071 $ 19,061 $ 16,418 $ 17,942 Interest bearing deposits in other financial institutions 52,047 48,025 63,439 54,755 67,647 Federal funds sold 654 553 707 607 419 Total cash and cash equivalents 70,584 71,649 83,207 71,780 86,008 Securities available-for-sale 333,554 350,027 339,585 346,233 371,374 Loans held-for-sale 1,253 2,567 1,185 667 340 Loans receivable, net of deferred fees and costs 1,508,976 1,508,242 1,506,398 1,508,251 1,512,595 Less: allowance for credit losses (16,911) (18,516) (18,330) (18,805) (18,768) Net loans receivable 1,492,065 1,489,726 1,488,068 1,489,446 1,493,827 Federal Home Loan Bank stock 6,547 6,547 6,547 6,547 6,547 Accrued interest receivable 7,721 7,442 7,695 7,583 8,045 Premises and equipment 47,259 47,912 48,696 47,795 38,436 Foreclosed real estate - - - 71 71 Cash value of bank owned life insurance 33,514 33,312 33,107 32,895 32,702 Goodwill 22,395 22,395 22,395 22,395 22,395 Other intangible assets 1,860 2,203 2,555 2,911 3,272 Other assets 43,947 40,882 44,027 43,459 45,262 Total assets $ 2,060,699 $ 2,074,662 $ 2,077,067 $ 2,071,782 $ 2,108,279 LIABILITIES AND STOCKHOLDERS' EQUITY Deposits: Non-interest bearing $ 263,324 $ 285,157 $ 286,784 $ 296,959 $ 295,594 Interest bearing 1,497,242 1,463,653 1,469,970 1,450,519 1,517,827 Total 1,760,566 1,748,810 1,756,754 1,747,478 1,813,421 Repurchase agreements 40,116 43,038 42,973 41,137 38,124 Borrowed funds 65,000 85,000 85,000 90,000 80,000 Accrued expenses and other liabilities 43,603 38,259 43,709 41,586 29,389 Total liabilities 1,909,285 1,915,107 1,928,436 1,920,201 1,960,934 Commitments and contingencies Stockholders' Equity: Preferred stock, no par or stated value; 10,000,000 shares authorized, none outstanding - - - - - Common stock, no par or stated value; 10,000,000 shares authorized; shares issued and outstanding: December 31, 2024 - 4,313,698 December 31, 2023 - 4,298,773 - - - - - Additional paid-in capital 70,034 69,916 69,778 69,727 69,555 Accumulated other comprehensive loss (58,084) (48,241) (58,939) (56,313) (51,613) Retained earnings 139,464 137,880 137,792 138,167 129,403 Total stockholders' equity 151,414 159,555 148,631 151,581 147,345 Total liabilities and stockholders' equity $ 2,060,699 $ 2,074,662 $ 2,077,067 $ 2,071,782 $ 2,108,279 Finward Bancorp Quarterly Financial Report Consolidated Statements of Income Quarter Ended, Twelve months ended, (Dollars in thousands) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) December 31, September 30, June 30, March 31, December 31, December 31, December 31, 2024 2024 2024 2024 2023 2024 2023 Interest income: Loans $ 19,802 $ 19,660 $ 19,174 $ 18,879 $ 19,281 $ 77,515 $ 74,762 Securities & short-term investments 2,793 2,812 2,953 3,105 2,975 11,663 11,021 Total interest income 22,595 22,472 22,127 21,984 22,256 89,178 85,783 Interest expense: Deposits 8,812 8,946 8,610 8,794 8,180 35,162 25,438 Borrowings 1,176 1,520 1,463 1,410 1,361 5,569 5,790 Total interest expense 9,988 10,466 10,073 10,204 9,541 40,731 31,228 Net interest income 12,607 12,006 12,054 11,780 12,715 48,447 54,555 Provision/(benefit) for credit losses (579) - 76 - 779 (503) 2,025 Net interest income after provision for credit losses 13,186 12,006 11,978 11,780 11,936 48,950 52,530 Noninterest income: Fees and service charges 1,439 1,463 1,257 1,153 1,507 5,312 6,024 Wealth management operations 728 731 763 633 672 2,855 2,484 Gain on tax credit investment 1,236 - - - - 1,236 - Gain on sale of loans held-for-sale, net 328 338 320 152 352 1,138 1,081 Increase in cash value of bank owned life insurance 202 205 212 193 193 812 766 Gain (Loss) on real estate (212) - 15 11,858 - 11,661 - Loss on sale of securities, net - - - (531) - (531) (48) Other 11 130 6 17 11 164 439 Total noninterest income 3,732 2,867 2,573 13,475 2,735 22,647 10,746 Noninterest expense: Compensation and benefits 6,628 6,963 7,037 7,109 6,290 27,737 27,655 Occupancy and equipment 2,045 2,181 2,116 1,908 1,484 8,250 6,382 Data processing 1,202 1,165 1,135 1,170 1,269 4,672 4,734 Federal deposit insurance premiums 457 435 397 501 492 1,790 2,003 Marketing 220 209 212 158 191 799 840 Professional and Outside Services 1,341 1,251 1,257 1,557 1,420 5,406 4,279 Technology 509 602 507 625 374 2,243 1,654 Other 1,845 1,668 1,756 1,976 1,997 7,245 7,684 Total noninterest expense 14,247 14,474 14,417 15,004 13,517 58,142 55,231 Income before income taxes 2,671 399 134 10,251 1,154 13,455 8,045 Income tax expenses (benefit) 569 (207) (9) 972 (356) 1,325 (335) Net income $ 2,102 $ 606 $ 143 $ 9,279 $ 1,510 $ 12,130 $ 8,380 Earnings per common share: Basic $ 0.49 $ 0.14 $ 0.03 $ 2.18 $ 0.36 $ 2.85 $ 1.96 Diluted $ 0.49 $ 0.14 $ 0.03 $ 2.17 $ 0.35 $ 2.84 $ 1.96 Finward Bancorp Quarterly Financial Report Asset Quality (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Dollars in thousands) December 31, September 30, June 30, March 31, December 31, 2024 2024 2024 2024 2023 Nonaccruing loans $ 13,738 $ 13,806 $ 11,079 $ 11,603 $ 9,608 Accruing loans delinquent more than 90 days - - 294 215 1,843 Securities in non-accrual 1,419 1,440 1,371 1,442 1,357 Foreclosed real estate - - - 71 71 Total nonperforming assets $ 15,157 $ 15,246 $ 12,744 $ 13,331 $ 12,879 Allowance for credit losses (ACL): ACL specific allowances for collateral dependent loans $ 284 $ 1,821 $ 1,327 $ 1,455 $ 906 ACL general allowances for loan portfolio 16,627 16,695 17,003 17,351 17,862 Total ACL $ 16,911 $ 18,516 $ 18,330 $ 18,806 $ 18,768 Bank Level Capital Minimum Required To Be (Dollars in thousands) Minimum Required For Well Capitalized Under Prompt Actual Capital Adequacy Purposes Corrective Action Regulations December 31, 2024 Amount Ratio Amount Ratio Amount Ratio Common equity tier 1 capital to risk-weighted assets $179,625 11.32% $71,415 4.50% $103,154 6.50% Tier 1 capital to risk-weighted assets $179,625 11.32% $95,219 6.00% $126,959 8.00% Total capital to risk-weighted assets $194,500 12.26% $126,959 8.00% $158,699 10.00% Tier 1 capital to adjusted average assets $179,625 8.46% $84,854 4.00% $106,068 5.00% Table 1 - Reconciliation of the Non-GAAP Performance Measures (Dollars in thousands) Quarter Ended, Twelve months ended, (unaudited) December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Calculation of tangible common equity Total stockholder's equity $ 151,414 $ 159,555 $ 148,631 $ 151,581 $ 147,345 $ 151,414 $ 147,345 Goodwill (22,395) (22,395) (22,395) (22,395) (22,395) (22,395) (22,395) Other intangibles (1,860) (2,203) (2,555) (2,911) (3,272) (1,860) (3,272) Tangible common equity $ 127,159 $ 134,957 $ 123,681 $ 126,275 $ 121,678 $ 127,159 $ 121,678 Calculation of tangible common equity adjusted for accumulated other comprehensive loss Tangible common equity $ 127,159 $ 134,957 $ 123,681 $ 126,275 $ 121,678 $ 127,159 $ 121,678 Accumulated other comprehensive loss 58,084 48,241 58,939 56,313 51,613 58,084 51,613 Tangible common equity adjusted for accumulated other comprehensive loss $ 185,243 $ 183,198 $ 182,620 $ 182,588 $ 173,291 $ 185,243 $ 173,291 Calculation of tangible book value per share Tangible common equity $ 127,159 $ 134,957 $ 123,681 $ 126,275 $ 121,678 $ 127,159 $ 121,678 Shares outstanding 4,313,698 4,313,940 4,313,940 4,310,251 4,298,773 4,313,698 4,298,773 Tangible book value per diluted share $ 29.48 $ 31.28 $ 28.67 $ 29.30 $ 28.31 $ 29.48 $ 28.31 Calculation of tangible book value per diluted share adjusted for accumulated other comprehensive loss Tangible common equity adjusted for accumulated other comprehensive loss $ 185,243 $ 183,198 $ 182,620 $ 182,588 $ 173,291 $ 185,243 $ 173,291 Diluted average common shares outstanding 4,313,698 4,313,940 4,313,940 4,310,251 4,298,773 4,313,698 4,298,773 Tangible book value per diluted share adjusted for accumulated other comprehensive loss $ 42.94 $ 42.47 $ 42.33 $ 42.36 $ 40.31 $ 42.94 $ 40.31 Calculation of tangible common equity to total assets Tangible common equity $ 127,159 $ 134,957 $ 123,681 $ 126,275 $ 121,678 $ 127,159 $ 121,678 Total assets 2,060,699 2,074,662 2,077,067 2,071,782 2,108,279 2,060,699 2,108,279 Tangible common equity to total assets 6.17 % 6.51 % 5.95 % 6.09 % 5.77 % 6.17 % 5.77 % Calculation of tangible common equity to total assets adjusted for accumulated other comprehensive loss Tangible common equity adjusted for accumulated other comprehensive loss $ 185,243 $ 183,198 $ 182,620 $ 182,588 $ 173,291 $ 185,243 $ 173,291 Total assets 2,060,699 2,074,662 2,077,067 2,071,782 2,108,279 2,060,699 2,108,279 Tangible common equity to total assets adjusted for accumulated other comprehensive loss 8.99 % 8.83 % 8.79 % 8.81 % 8.22 % 8.99 % 8.22 % Calculation of tax adjusted net interest margin Net interest income $ 12,607 $ 12,006 $ 12,054 $ 11,780 $ 12,715 $ 48,447 $ 54,555 Tax adjusted interest on securities and loans 674 678 677 699 722 2,728 2,956 Adjusted net interest income $ 13,281 12,684 12,731 12,749 $ 13,437 $ 51,175 $ 57,511 Total average earning assets 1,905,353 1,910,731 1,906,998 1,945,501 1,920,127 1,909,915 1,927,455 Tax adjusted net interest margin 2.79 % 2.66 % 2.67 % 2.57 % 2.80 % 2.68 % 2.98 % Efficiency ratio Total non-interest expense $ 14,247 $ 14,474 $ 14,417 $ 15,004 $ 13,517 $ 58,142 $ 55,232 Total revenue 16,339 14,873 14,627 25,255 15,450 71,094 65,301 Efficiency ratio 87.20 % 97.32 % 98.56 % 59.41 % 87.49 % 81.78 % 84.58 % FOR FURTHER INFORMATION CONTACT SHAREHOLDER SERVICES (219) 853-7575
