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

NORTH CONWAY, N.H., July 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 June 30, 2024 of $859 thousand, or $0.31 per basic common share, compared to $1.7 million, or $0.63 per basic common share for the quarter ended June 30, 2023. For the six months ended June 30, 2024, the Company reported net income of $2.4 million, or $0.86 per basic common share, compared to $3.1 million, or $1.13 per basic common share for the same period in 2023.

The Board of Directors declared a semi-annual cash dividend of $0.35 per share, payable on August 12, 2024, to common stockholders of record on August 5, 2024.

President and CEO William J. Woodward commented: "During the first six months of 2024 we continued to focus on retaining and increasing our core deposit base while reducing our reliance on wholesale funding. We also have taken a cautious view on lending with added emphasis on strengthening our relationship with existing customers. We have also attempted to encourage a full banking relationship with new customers. The increased cost of deposits has impacted earnings, but we are confident that repositioning the balance sheet will provide the best path forward to increase shareholder value over the long term. Finally, I am pleased to announce the payment of our semi-annual dividend which has been uninterrupted since Northway Financial was formed in 1997."

Financial Highlights

• Total Assets were $1.3 billion, Loans, Net, were $919 million, and Total Deposits were $1 billion at June 30, 2024.
• Total Assets decreased $94 million compared to June 30, 2023, driven by decreases in Securities Available-for-Sale at Fair Value of $46 million, Loans, Net of $31 million, and Cash and Due from Banks and Interest-Bearing Deposits.
• The decrease in Securities Available-for-Sale at Fair Value was primarily due to the sale of $30 million in securities in December 2023.
• The decrease in Loans, Net was the result of decreases in Commercial and Residential Real Estate loans of $50 million partially offset by an increase in Municipal Loans of $20 million, compared to June 30, 2023.
• Non-Municipal Deposits (excluding brokered deposits) decreased $23 million, or 0.4%, compared to June 30, 2023, the result of a decrease in Commercial Deposits of $15 million and a decrease in Retail Deposits of $7 million.
• Non-Municipal Deposits (excluding brokered deposits) were unchanged, compared to December 31, 2023.
• Wholesale Funding, which includes brokered deposits and borrowings, decreased $68 million compared to June 30, 2023, and $30 million compared to December 31, 2023.
• Net Income for the six-month period ending June 30, 2024, was $2.4 million or $0.86 per basic common share.
• Year-to-date Net Interest Income was $1.9 million lower than the same period last year driven by an increase in interest expense of $1.8 million.
• Year-to-date Net Interest Margin decreased from 2.70% to 2.60% as funding costs increased .47% while the yield on earning assets increased 0.27%, when compared to year-to-date June 30, 2023.
• Nonperforming loans as a percentage of total loans stood at 0.38% compared to 0.25% at June 30, 2023.
• Total delinquent loans as a percentage of total loans were 0.07% compared to 0.05% at June 30, 2023.
• The Bank's regulatory capital ratios at June 30, 2024 exceeded all well-capitalized ratios as defined under FDIC's prompt corrective action rules.
• The market price of our common stock, as of July 25, 2024, was $19.55.

Northway Financial, Inc. Selected Financial Highlights (Unaudited)
(Dollars in thousands, except per share data)	Three Months Ended		Six Months Ended
	6/30/2024			6/30/2023			6/30/2024			6/30/2023
Interest and Dividend Income	$	12,216			$	12,940			$	24,804			$	24,888
Interest Expense		4,826				4,545				9,177				7,430
Net Interest and Dividend Income		7,390				8,395				15,627				17,458
Provision for Credit Losses		-				-				-				-
All Other Noninterest Income		1,117				1,253				2,374				2,499
Noninterest Expense		7,710				7,836				15,796				16,310
Net Income Before Gain (Loss) on Securities		797				1,812				2,205				3,647
Gain (Loss) on Securities Available-for-Sale, Net		-				-				-				-
(Loss) Gain on Marketable Equity Securities		(11	)			140				266				(110	)
Income before Income Tax (Benefit) Expense		786				1,952				2,471				3,537
Income Tax (Benefit) Expense		(73	)			229				100				439
Net Income	$	859			$	1,723			$	2,371			$	3,098
Net Income Available to Common Stockholders	$	859			$	1,723			$	2,371			$	3,098
Earnings per Common Share, Basic	$	0.31			$	0.63			$	0.86			$	1.13

		6/30/2024			12/31/2023			6/30/2023
Balance Sheet
Total Assets		$	1,276,475			$	1,290,467			$	1,369,352
Cash and Due from Banks and Interest-Bearing Deposits			62,567				68,887				74,260
Securities Available-for-Sale, at Fair Value			234,823				246,756				281,187
Marketable Equity Securities, at Fair Value			2,856				2,589				5,606
Loans Held-for-Sale			767				-				469
Loans, Net			918,579				909,781				949,547
Total Liabilities			1,204,177				1,217,230				1,301,879
Non Municipal Non-Maturity Deposits			697,713				734,741				760,416
Municipal Non-Maturity Deposits			154,469				133,100				149,713
Certificates of Deposit			162,525				127,726				151,182
Securities Sold Under Agreements to Repurchase			53,301				55,353				63,878
Short-Term Borrowings			50,000				65,000				59,500
Long-Term Debt			45,000				60,000				75,000
Junior Subordinated Debentures			20,620				20,620				20,620
Stockholders' Equity			72,298				73,237				67,473
Profitability and Efficiency
Net Interest Margin			2.60	%			2.63	%			2.70	%
Yield on Earning Assets			4.09				3.90				3.82
Cost of Interest Bearing Liabilities			1.93				1.63				1.45
Book Value Per Share of Common Shares Outstanding		$	26.27			$	26.62			$	24.52
Tangible Book Value Per Share of Common Shares Outstanding			22.49				22.83				20.74
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			9.21	%			8.30	%			8.16	%
Common Equity Risk-Based Capital			14.75				14.40				13.59
Tier 1 Risk-Based Capital			14.75				14.40				13.59
Total Risk-Based Capital			16.00				15.65				14.84

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 

Source: Northway Financial Inc.

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