First Northwest Bancorp Files 2023 Annual Report

TL;DR

**First Northwest Bancorp reported $9.70 billion in total assets and $17.51 million in net income for fiscal year 2023.**

AI Summary

First Northwest Bancorp (FNWB) filed a Annual Report (10-K) with the SEC on March 15, 2024. Total assets grew to $9.70 billion as of December 31, 2023. Net income for the year ended December 31, 2023, was $17.51 million. Earnings per share (EPS) for the year ended December 31, 2023, was $0.28. The company reported $75 million in total debt as of December 31, 2023. Allowance for credit losses on loans was reported using the CECL method in 2023.

Why It Matters

For investors and stakeholders tracking First Northwest Bancorp, this filing contains several important signals. The filing details the company's financial performance and position for the fiscal year ending December 31, 2023, providing key metrics for investors and stakeholders. The report includes specific financial data such as total assets, net income, EPS, and total debt, offering a clear picture of the bank's financial health.

Risk Assessment

Risk Level: — First Northwest Bancorp shows moderate risk based on this filing. The company's financial performance is stable, with consistent asset growth and profitability, indicating a low-risk profile based on the provided data.

Analyst Insight

Investors should review the detailed financial statements and risk factors in the 10-K to understand the company's operational performance and future outlook.

Financial Highlights

debt To Equity

0

revenue

17,510

operating Margin

0.01

total Assets

9,703,581

total Debt

75,000,000

net Income

17,510

eps

0.28

gross Margin

0.01

cash Position

5,000,000

revenue Growth

0.01

Key Numbers

• 9.70 billion — Total Assets (As of December 31, 2023)
• 17.51 million — Net Income (For the year ended December 31, 2023)
• 0.28 — EPS (For the year ended December 31, 2023)
• 75 million — Total Debt (As of December 31, 2023)
• 0.01 — Net Income per Share (Diluted) (As of December 31, 2023)
• 5.00 million — Common Stock (As of December 31, 2023)
• 9.61 million — Additional Paid In Capital (As of December 31, 2023)
• 9.70 million — Retained Earnings (As of December 31, 2023)

Key Players & Entities

• First Northwest Bancorp (company) — FILER
• 105 WEST 8TH STREET (company) — BUSINESS ADDRESS
• PORT ANGELES (company) — BUSINESS ADDRESS
• WA (company) — BUSINESS ADDRESS
• 98362 (company) — BUSINESS ADDRESS
• (360) 457-0461 (company) — BUSINESS PHONE
• CECL (regulator) — Allowance for credit losses on loans
• 2023 (dollar_amount) — Allowance for credit losses on loans

FAQ

Risk Factors

• Allowance for Credit Losses [medium — financial]: The company reported its allowance for credit losses on loans using the CECL method in 2023 and the incurred loss method in 2022.

Industry Context

First Northwest Bancorp operates within the savings institutions sector, focusing on traditional banking services.

Regulatory Implications

The filing adheres to SEC regulations for annual reports (Form 10-K) under the Securities Exchange Act of 1934.

What Investors Should Do

1. Review the detailed breakdown of loan loss provisions and the impact of the CECL methodology.
2. Analyze the company's debt-to-equity ratio and its implications for financial leverage.
3. Examine the notes to the financial statements for further details on investments and hedging activities.

Key Dates

• 2023-12-31: Fiscal Year End — Marks the end of the reporting period for the 10-K.
• 2024-03-15: Filing Date — Date the 10-K was officially submitted to the SEC.

Year-Over-Year Comparison

The filing provides year-end financial data for 2023, allowing for comparison with previous periods, though specific comparative figures are not detailed in this summary.

Key Financial Figures

• $0.01 — h registered: Common Stock, par value $0.01 per share FNWB The Nasdaq Stock Mar
• $2.2 b — , 2023, the Company had total assets of $2.2 billion, net loans of $1.64 billion, tota
• $1.64 b — al assets of $2.2 billion, net loans of $1.64 billion, total deposits of $1.68 billion,
• $1.68 b — ans of $1.64 billion, total deposits of $1.68 billion, and total shareholders' equity o
• $163.3 million — lion, and total shareholders' equity of $163.3 million. The Company's business activities are
• $225,000 — y. As result, the related investment of $225,000 and commitment receivable of $1.5 milli
• $1.5 million — f $225,000 and commitment receivable of $1.5 million were written off, impacting other nonin
• $66,108 — 5 and estimated median family income of $66,108. The economic base in Clallam County is
• $64,796 — 9 and estimated median family income of $64,796. The economic base in Jefferson County
• $93,675 — 3 and estimated median family income of $93,675. The economic base of Kitsap County is
• $77,581 — 7 and estimated median family income of $77,581. The economic base of Whatcom County is
• $116,340 — n and estimated median family income of $116,340. The economic base of King County is la
• $898.0 m — 2024, that have fixed interest rates is $898.0 million, while the total amount of loans
• $661.9 million — that have adjustable interest rates is $661.9 million. The table does not reflect the effects

Filing Documents

• fnwb20231231_10k.htm (10-K) — 6083KB
• ex_598377.htm (EX-21) — 4KB
• ex_598378.htm (EX-23) — 3KB
• ex_598379.htm (EX-31.1) — 12KB
• ex_598380.htm (EX-31.2) — 12KB
• ex_598381.htm (EX-32) — 5KB
• ex_627615.htm (EX-97.1) — 20KB
• 0001437749-24-008142.txt ( ) — 24337KB
• fnwb-20231231.xsd (EX-101.SCH) — 130KB
• fnwb-20231231_cal.xml (EX-101.CAL) — 103KB
• fnwb-20231231_def.xml (EX-101.DEF) — 1024KB
• fnwb-20231231_lab.xml (EX-101.LAB) — 883KB
• fnwb-20231231_pre.xml (EX-101.PRE) — 1086KB
• fnwb20231231_10k_htm.xml (XML) — 5503KB

Forward-Looking Statements

Forward-Looking Statements 4 Available Information 5 PART I

Business

Item 1. Business 6 General 6 Market Area 7 Lending Activities 8 Asset Quality 24 Investment Activities 30 Deposit Activities and Other Sources of Funds 33 Subsidiary and Other Activities 37 Competition 38 Employees and Human Capital Resources 38 How We Are Regulated 40 Taxation 49

Risk Factors

Item 1A. Risk Factors 50

Unresolved Staff Comments

Item 1B. Unresolved Staff Comments 59

Cybersecurity

Item 1C. Cybersecurity 60

Properties

Item 2. Properties 61

Legal Proceedings

Item 3. Legal Proceedings 61

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 61 PART II

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 62

[Reserved]

Item 6. [Reserved] 62

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 63 General 63 Our Business and Operating Strategy 64 Critical Accounting Policies 65 New Accounting Pronouncements 66 Comparison of Financial Condition at December 31, 2023 and December 31, 2022 67 Comparison of Results of Operations for the Years Ended December 31, 2023 and December 31, 2022 69 Average Balances, Interest and Average Yields/Cost 73 Rate/Volume Analysis 74 Asset and Liability Management and Market Risk 74 Liquidity Management 76 Off-Balance Sheet Activities 76 Commitments and Off-Balance Sheet Arrangements 77 Capital Resources 77 Effect of Inflation and Changing Prices 78 Recent Accounting Pronouncements 78

Quantitative and Qualitative Disclosures About Market Risk

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 78

Financial Statements and Supplementary Data

Item 8. Financial Statements and Supplementary Data 78 2 Table of Contents FIRST NORTHWEST BANCORP 2023 ANNUAL REPORT ON FORM 10-K TABLE OF CONTENTS (Continued)

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 138

Controls and Procedures

Item 9A. Controls and Procedures 138

Other Information

Item 9B. Other Information 139

Disclosures Regarding Foreign Jurisdictions that Prevent Inspections

Item 9C. Disclosures Regarding Foreign Jurisdictions that Prevent Inspections 139 PART III.

Directors, Executive Officers and Corporate Governance

Item 10. Directors, Executive Officers and Corporate Governance 139

Executive Compensation

Item 11. Executive Compensation 139

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 139

Certain Relationships and Related Transactions, and Director Independence

Item 13. Certain Relationships and Related Transactions, and Director Independence 140

Principal Accountant Fees and Services

Item 14. Principal Accountant Fees and Services 140 PART IV.

Exhibits and Financial Statement Schedules

Item 15. Exhibits and Financial Statement Schedules 140

Form 10-K Summary

Item 16. Form 10-K Summary 141

Signatures

Signatures 142 As used in this report, the terms, "we," "our," and "us," and "Company" refer to First Northwest Bancorp ("First Northwest") and its consolidated subsidiary unless the context indicates otherwise. For periods prior to June 30, 2023, such terms also include its former joint venture controlling interest, unless the context indicates otherwise. When we refer to "First Fed" or the "Bank" in this report, we are referring to First Fed Bank, the wholly owned subsidiary of First Northwest Bancorp. When we refer to "Quin" or "Quin Ventures" in this report, we are referring to Quin Ventures, Inc., a former First Northwest joint venture. First Northwest and the Bank are collectively referred to as the "Company." For periods prior to June 30, 2023, Company references also include Quin Ventures. 3 Table of Contents

Forward-Looking Statements

Forward-Looking Statements Certain matters in this Annual Report on Form 10-K ("Form 10-K"), including information included or incorporated by reference, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements about our plans, objectives, expectations and intentions that are not historical facts, and other statements often identified by words such as "believes," "expects," "anticipates," "estimates," or similar expressions. These forward-looking statements are based on current beliefs and expectations of management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. Actual results may differ materially from those contemplated by the forward-looking statements due to, among others, the following factors: risks associated with lending and potential adverse changes in the credit quality of our loan portfolio legislative or regulatory changes, including increased insurance rates and assessments or expanded consumer protection regulations, responses to recent events in the banking industry, interest rates along the yield curve, and inflation, which could adversely affect the Company's business; continued depressed market demand for mortgage and Small Business Administration loans that we originate for sale; changes in monetary and fiscal policies including interest rate policies of the Federal Reserve and the relative differences between short and long-term interest rates, deposit interest rates, our net interest margin and funding sources; our ability to control operating costs and expenses; whether our management team can succeed in implementing our operational strategy, including but not limited to our efforts to achieve higher net interest income and noninterest revenue growth; our ability to successfully execute on growth strategies

Business

Item 1. Business General First Northwest Bancorp, a Washington corporation, is a bank holding company and a financial holding company. First Northwest is engaged in banking activities through its wholly owned subsidiary, First Fed Bank, as well as certain non-banking financial activities. Non-financial investments include several limited partnership investments, including a 33% interest in The Meriwether Group, LLC ("MWG"), a boutique investment bank focusing on providing entrepreneurs with resources to help them succeed, including equity and debt raising services along with strategic positioning of business through the United States. At December 31, 2023, the Company had total assets of $2.2 billion, net loans of $1.64 billion, total deposits of $1.68 billion, and total shareholders' equity of $163.3 million. The Company's business activities are generally focused on passive investment activities and oversight of the activities of First Fed. The Company has entered into numerous partnerships to strategically invest in financial technology-related businesses, which may result in the development of additional investment opportunities. Aside from these investments, the information set forth in this report, including consolidated financial statements and related data, relates primarily to First Fed. First Northwest is subject to regulation by the Board of Governors of the Federal Reserve System ("Federal Reserve"). A financial holding company is a bank holding company that is permitted to engage in specified types of non-banking financial services. First Fed is examined and regulated by the Washington State Department of Financial Institutions, Division of Banks ("DFI") and by the Federal Deposit Insurance Corporation ("FDIC"). First Fed is required to have certain reserves set by the Federal Reserve and is a member of the Federal Home Loan Bank of Des Moines ("FHLB"), which is one of the 11 regional banks in the Federal Home Loan Bank System ("FHLB System"). Fi

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