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CST: 22/10/2019 12:15:40   

Northway Financial, Inc. Announces 2018 Earnings and Declares Semi-Annual Dividend

263 Days ago

NORTH CONWAY, N.H., Feb. 01, 2019 (GLOBE NEWSWIRE) -- Northway Financial, Inc. (the “Company”) (OTCQB: NWYF), the parent company of Northway Bank (the “Bank”), today reported net income for the year ended December 31, 2018 of $2.9MM, or $1.07 per basic common share, compared to $7.3MM, or $2.64 per basic common share for the year ended December 31, 2017.

The Board of Directors has declared a semi-annual cash dividend of $0.35 per share, payable on February 19, 2019, to common stockholders of record on February 11, 2019.  William J. Woodward President and Chief Executive Officer stated, “We are continuing our current level of dividend as we believe our investment in loan growth will continue to generate revenue for years to come.”

In 2018, the Bank adopted ASU 2016-01, “Financial Instruments – overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.”  The adoption of this ASU requires equity investments to be measured at fair value with changes in fair value recognized in net income. With the current volatility in the stock market, net income for 2018 was negatively impacted by a $1.8MM unrealized loss on equity securities, net of taxes.

The investment we made to support loan growth has begun to pay dividends as we saw interest and dividend income improve $3.4MM compared to the prior year primarily as a result of an increase in average loan balances of $67MM, an increase of 12%, partially offset by an increase in noninterest expense related to the hiring of additional resources to support our growth strategy.

Financial Highlights       

  • Total assets were $927MM, total loans, net, were $628MM, and total deposits were $726MM at December 31, 2018.
  • Loans, net, increased $63MM, or 11.1%, from December 31, 2017, which is the result of the implementation of our organic growth strategy. 
  • Net interest income increased $1.5MM for the year ended December 31, 2018 when compared to the same period last year.
  • Net income for the year ending December 31, 2018 was $4.3MM less than the same period last year, primarily due to the previously mentioned unrealized loss on equity securities, a decrease in realized gains on securities, the previously mentioned increase in noninterest expense, and an increase in interest expense.
  • The net interest margin at December 31, 2018 was 3.36%.
  • The yield on earning assets was 3.91% and the cost of interest-bearing liabilities was 0.70%, for the year ended December 31, 2018.
  • For the year ended December 31, 2018, Return on Average Assets was 0.31% and Return on Average Equity was 3.75%
  • Regulatory capital ratios at December 31, 2018 were 9.83% Tier 1 Leverage, 15.27% Total Risk Based Capital, and 16.44% Common Equity Tier 1.
  • Nonperforming loans as a percentage of total loans stood at 0.35% at December 31, 2018.
  • The market price of our common stock, as of January 30, 2019, was $30.50   

 
Northway Financial, Inc.
Selected Financial Highlights
(Unaudited)
               
(Dollars in thousands, except per share data) Three Months Ended   Year Ended
  12/31/2018   12/31/2017   12/31/2018   12/31/2017
               
Interest and Dividend Income $ 9,259     $ 7,878   $ 34,364     $ 30,920
Interest Expense   1,530       740     4,986       3,034
Net Interest and Dividend Income   7,729       7,138     29,378       27,886
Provision for Loan Losses   195       -     390       -
All Other Noninterest Income   938       1,055     4,662       5,478
Noninterest Expense   7,554       7,084     29,022       26,342
Net Income Before Securities Gains   918       1,109     4,628       7,022
Realized Securities Gains, Net   54       1,102     590       2,704
Unrealized Securities (Losses) Gains, Net   (2,464 )     -     (2,498 )     -
Net Income Before Taxes   (1,546 )     1,109     2,130       7,022
Provision for Income Tax   (255 )     492     (218 )     2,448
Net Income $ (1,291 )   $ 617   $ 2,348     $ 4,574
Net Income Available to Common Stockholders $ (1,237 )   $ 1,719   $ 2,938     $ 7,278
Earnings per Common Share, Basic $ (0.45 )   $ 0.62   $ 1.07     $ 2.64
               

 

         
  12/31/2018   12/31/2017  
         
Balance Sheet        
Total Assets $   926,898   $   884,084  
Cash and Due from Banks and Interest-Bearing Deposits     18,132       25,091  
Securities Available-for-Sale, at Fair Value     243,387       258,109  
Loans, Net     627,915       565,294  
Total Liabilities     847,480       802,895  
Retail non-maturity deposits     494,793       503,391  
Municipal non-maturity deposits     101,746       108,918  
Certificates of deposit     128,993       110,446  
Federal Home Loan Bank Advances     13,848       -   
Securities Sold Under Agreements to Repurchase     79,340       53,380  
Junior Subordinated Debentures     20,620       20,620  
Stockholders' Equity     79,418       81,189  
Profitability and Efficiency        
Net Interest Margin     3.36 %     3.48 %
Yield on Earning Assets     3.91       3.84  
Cost of Interest Bearing Liabilities     0.70       0.45  
Book Value Per Share of Common Shares Outstanding $   28.86   $   29.51  
Tangible Book Value Per Share of Common Shares Outstanding     25.25       25.88  
Capital and Credit        
Tier 1 Core Capital to Average Assets     9.83 %     10.45 %
Common Equity Risk-Based Capital     12.08       12.08  
Tier 1 Risk-Based Capital     15.27       15.35  
Total Risk-Based Capital     16.44       16.66  
Common Shares Outstanding     2,751,650       2,751,650  
Weighted Average Number of Common Shares, Basic     2,751,650       2,751,650  
Return on Average Assets     0.31 %     0.82 %
Return on Average Equity     3.75       9.32  
Nonperforming Loans as a % of Total Loans     0.35       0.52  
Allowance for Loan Losses as a % of Nonperforming Loans     323       242  
             

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 16 full-service 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

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