Northwest Bancshares Inc Q4 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Tim Switzer - Keefe, Bruyette & Woods Inc - Analyst : Hey, good morning. Thank you for taking my questions. We appreciate the detailed guide you provided in the slide deck here. Can you clarify real quick for the noninterest income outlook. Does that also exclude the impact of Penns Woods and what's driving that growth there?

Question: Tim Switzer - Keefe, Bruyette & Woods Inc - Analyst : Yeah. No, it's super helpful. I appreciate you doing that. And if we think about the NII outlook with Penns Woods, the rate movements have been pretty extreme over the last month or so. Can you talk about, I guess, first, maybe how that's changed, you expected tangible book value dilution? And then what's the expected purchase accounting as of most recently with the change in the yield curve.

Question: Tim Switzer - Keefe, Bruyette & Woods Inc - Analyst : Okay. And the last question I have is, after cleaning up some of the credit book here, can you give us an update on like what's remaining in the health care portfolio, what the credit quality looks like? And then, are you seeing any other areas outside of that book that more cautious about or anything you're seeing in maybe the consumer portfolio?

Question: Tim Switzer - Keefe, Bruyette & Woods Inc - Analyst : Okay, great. Thank you, guys. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 24, 2025 / 3:00PM, NWBI.OQ - Q4 2024 Northwest Bancshares Inc Earnings Call

Question: Daniel Tamayo - Raymond James Financial Inc - Analyst : Thank you. Good morning, guys. So I guess my first question, just on the loan growth side. You talked about, I think, a low single digits for the year. You've had strong momentum certainly on the commercial side. Maybe if you could just talk about what you're seeing in terms of momentum in the commercial side, if that's still strong and then really the driver of the net loan growth number is reductions in CRE or other portfolios? Or just how you're thinking about it kind of segmented out a little bit?

Question: Daniel Tamayo - Raymond James Financial Inc - Analyst : Got it. That makes sense. So you think it's maybe a little bit slower than what it can be on a total loan growth basis next year and then you could potentially end the year a little bit faster and going into '26, moving towards more of a normalized loan growth rate maybe in the mid or a little bit above that percentage growth, percentage rate.

Question: Daniel Tamayo - Raymond James Financial Inc - Analyst : Terrific. Thanks for all that color. I guess just one last one, maybe on the securities book. I'm just looking at your slide 9 here on that. You've got the direct duration of five and four years. So I'm just curious kind of what's rolling off this year where you might see some benefit in terms of the margin in 2025, obviously, that book remains a little bit of a drag on the NIM overall from a dollars perspective.

Question: Daniel Tamayo - Raymond James Financial Inc - Analyst : It does. Yeah. No, thanks for all the color. I appreciate it. I'll step back.

Question: Matthew Breese - Stephens Inc - Analyst : Hey, good morning. I wanted to touch on commercial real estate just for a second. A lot of your peers in similar situations as you with lower CRE concentrations, many of them have been kind of nibbling back into the space as a lot of your higher CRE concentration peers have kind of pulled back. And I'm curious if you've kind of looked at spreads and yields and if there's been any sort of change in thinking there? And is that a book if the yields present themselves that we might see some growth in '25? Thank you.

Question: Matthew Breese - Stephens Inc - Analyst : So from our perspective, is it fair to consider that portion of the loan portfolio flattish for the year. Is that a fair statement?

Question: Matthew Breese - Stephens Inc - Analyst : Thank you. And then I was hoping you could also just go into expectations around loan and deposit betas expectations for the year? And as you exit 2025, do you think there's an upward bias to the NIM, given the shape of the yield curve? And actually this environment for you with an upward sloping yield curve is certainly improving, if not a more ideal one than we've seen in the last couple of years.

Question: Matthew Breese - Stephens Inc - Analyst : Got it. Okay. And then the last one for me. I appreciate the net charge-off guide. Maybe you could help us out a little bit with the provision and/or where you expect the reserve to settle out given the mix shift in the loan portfolio.

Question: Matthew Breese - Stephens Inc - Analyst : That's all I had. Thanks for taking my questions.

Question: Daniel Cardenas - Janney Montgomery Scott LLC - Analyst : Good morning, guys. Just a quick follow-up -- excuse me, on that provision comment. When you say we're looking for a slight increase, I guess, the '24, that's excluding the fourth quarter results.

Question: Daniel Cardenas - Janney Montgomery Scott LLC - Analyst : Perfect. Okay. Got you. And then on capital deployment front, what are your thoughts on buybacks here in 2025? Are you kind of handcuffed until the deal is done? Or would you guys be in the market looking to buy back stock opportunistically.

Question: Daniel Cardenas - Janney Montgomery Scott LLC - Analyst : Perfect. All right, all my other questions you've been asked and answered. Thanks. So I'll step back.