• First Financial Northwest, Inc. Reports Net Income of $1.2 Million or $0.13 per Diluted Share for the Fourth Quarter and $1.1 Million or $0.12 per Diluted Share for the Year Ended December 31, 2024

    المصدر: Nasdaq GlobeNewswire / 28 يناير 2025 09:10:49   America/New_York

    RENTON, Wash., Jan. 28, 2025 (GLOBE NEWSWIRE) -- First Financial Northwest, Inc. (the “Company”) (NASDAQ GS: FFNW), the holding company for First Financial Northwest Bank (the “Bank”), today reported net income for the quarter ended December 31, 2024, of $1.2 million, or $0.13 per diluted share, compared to a net loss of $608,000, or $(0.07) per diluted share, for the quarter ended September 30, 2024, and net income of $1.2 million, or $0.13 per diluted share, for the quarter ended December 31, 2023. For the twelve months ended December 31, 2024, the Company reported net income of $1.1 million, or $0.12 per diluted share, compared to net income of $6.3 million, or $0.69 per diluted share, for the year ended December 31, 2023.

    The improved performance in the current quarter compared to the quarter ended September 30, 2024, was due primarily to a $1.3 million recapture of provision for credit losses. This compares to a provision for credit losses of $1.6 million in the prior quarter that mainly related to two participation loans to a single borrowing entity totaling approximately $6.0 million, where we were not the lead lender. During the quarter ended December 31, 2024, one of the two loans was paid in full and the borrower paid down the balance on the other loan using proceeds from the sale of another property. Subsequently, we received an updated appraisal of the property securing the remaining loan that confirmed a value sufficient to support the recapture of the previously allocated specific reserve for this loan.

    “I am pleased to report that our net loans receivable increased $14.0 million in the quarter as our lending teams continue to focus on growing our loan portfolio. In addition, our credit quality remained strong, with only $842,000 in nonaccrual loans, representing 0.07% of our $1.16 billion total loan portfolio,” stated Joseph W. Kiley III, President and CEO.

    “We continue to prepare for the closing of the sale of the Bank to Global Federal Credit Union (“Global”), as we await the final required approval from Global’s primary regulator, the National Credit Union Administration, before we can proceed towards closing the transaction,” concluded Kiley.

    Highlights for the quarter and year ended December 31, 2024:

    • Net loans receivable totaled $1.14 billion at December 31, 2024, compared to $1.13 billion at September 30, 2024, and $1.18 billion at December 31, 2023.
    • Book value per common share was $17.50 at December 31, 2024, compared to $17.39 at September 30, 2024, and $17.61 at December 31, 2023.
    • The Bank’s Tier 1 leverage and total capital ratios were 11.2% and 16.7% at December 31, 2024, compared to 10.9% and 16.7% at September 30, 2024, and 10.2% and 16.2% at December 31, 2023, respectively.
    • Credit quality remained strong with nonaccrual loans totaling $842,000, or 0.07% of total loans at December 31, 2024.
    • A $1.3 million recapture of provision for credit losses was recorded in the current quarter, compared to a $1.6 million and no provision for credit losses recorded during the prior quarter and the same quarter a year ago, respectively. We recorded a $50,000 recapture of provision for credit losses for the year ended December 31, 2024, compared to a $208,000 recapture of provision for credit losses for the year ended December 31, 2023.

    Deposits decreased $36.0 million to $1.13 billion at December 31, 2024, compared to $1.17 billion at September 30, 2024, and decreased $62.7 million compared to $1.19 billion at December 31, 2023. The decrease in deposits at December 31, 2024, compared to September 30, 2024, was due primarily to a $19.7 million decrease in noninterest-bearing demand deposits and a $15.5 million decrease in money market deposits. The decrease in deposits at December 31, 2024, from December 31, 2023, reflects declines in all deposit categories except for retail certificates of deposit which increased $91.8 million.

    Federal Home Loan Bank (“FHLB”) advances totaled $110.0 million at December 31, 2024, compared to $100.0 million at September 30, 2024, and $125.0 million at December 31, 2023. Of the total FHLB advances at December 31, 2024, $100.0 million were tied to cash flow hedge agreements under which the Bank pays a fixed rate and receives a variable rate in return to assist in the Bank’s interest rate risk management efforts. These cash flow hedge agreements had a weighted average remaining term of 27.8 months and a weighted average fixed interest rate of 1.93% as of December 31, 2024. The average cost of borrowings was 2.35% for the quarter ended December 31, 2024, compared to 3.19% for the quarter ended September 30, 2024, and 2.40% for the quarter ended December 31, 2023.

    The following table presents a breakdown of our total deposits (unaudited):

     Dec 31,
    2024    		 Sep 30,
    2024    		 Dec 31,
    2023    		 Three
    Month
    Change    		 One
    Year
    Change
    Deposits:(Dollars in thousands)
    Noninterest-bearing demand$80,772 $100,466 $100,899 $(19,694) $(20,127)
    Interest-bearing demand 56,957  55,506  56,968  1,451   (11)
    Savings 16,277  17,031  18,886  (754)  (2,609)
    Money market 480,520  495,978  529,411  (15,458)  (48,891)
    Certificates of deposit, retail 448,974  447,474  357,153  1,500   91,821 
    Brokered deposits 47,900  50,900  130,790  (3,000)  (82,890)
    Total deposits$1,131,400 $1,167,355 $1,194,107 $(35,955) $(62,707)


    The following tables present an analysis of total deposits by branch office (unaudited):

    December 31, 2024
     Noninterest-
    bearing
    demand    		Interest-
    bearing
    demand    		SavingsMoney
    market    		Certificates
    of deposit,
    retail    		Brokered
    deposits    		Total
     (Dollars in thousands)
    King County       
    Renton$26,242$14,786$10,197$284,670$309,858$-$645,753
    Landing 3,245 1,359 170 7,958 14,965 - 27,697
    Woodinville 1,738 3,168 620 8,834 11,511 - 25,871
    Bothell 2,792 930 408 1,421 6,762 - 12,313
    Crossroads 11,075 2,762 86 29,208 18,772 - 61,903
    Kent 3,766 4,873 40 18,673 8,471 - 35,823
    Kirkland 5,524 1,924 208 11,574 1,855 - 21,085
    Issaquah 1,244 238 13 2,298 6,562 - 10,355
    Total King County 55,626 30,040 11,742 364,636 378,756 - 840,800
    Snohomish County       
    Mill Creek 3,184 3,496 342 16,135 12,487 - 35,644
    Edmonds 7,316 8,542 338 16,482 13,003 - 45,681
    Clearview 4,909 5,653 1,494 17,934 13,778 - 43,768
    Lake Stevens 3,633 5,946 1,314 24,571 17,004 - 52,468
    Smokey Point 2,544 1,800 1,032 36,950 9,619 - 51,945
    Total Snohomish County 21,586 25,437 4,520 112,072 65,891 - 229,506
    Pierce County       
    University Place 1,837 54 1 2,113 2,122 - 6,127
    Gig Harbor 1,723 1,426 14 1,699 2,205 - 7,067
    Total Pierce County 3,560 1,480 15 3,812 4,327 - 13,194
            
    Brokered deposits - - - - - 47,900 47,900
            
    Total deposits$80,772$         56,957$        16,277$     480,520$      448,974$        47,900$   1,131,400


    September 30, 2024
     Noninterest-
    bearing
    demand     		Interest-
    bearing
    demand    		 Savings Money
    market     		Certificates
    of deposit,
    retail    		Brokered
    deposits    		Total
     (Dollars in thousands)
    King County        
    Renton$29,388$14,153$10,654$305,836$315,721$-$675,752
    Landing 3,442 1,660 237 8,348 12,733 - 26,420
    Woodinville 1,968 2,234 959 8,852 11,522 - 25,535
    Bothell 2,965 1,151 401 1,536 5,918 - 11,971
    Crossroads 14,770 2,039 107 31,665 18,136 - 66,717
    Kent 5,417 10,502 44 16,053 8,562 - 40,578
    Kirkland 10,967 1,890 206 11,243 2,240 - 26,546
    Issaquah 1,186 294 18 2,547 6,580 - 10,625
    Total King County 70,103 33,923 12,626 386,080 381,412 - 884,144
    Snohomish County       
    Mill Creek 3,990 2,171 384 14,628 10,312 - 31,485
    Edmonds 9,254 6,831 330 18,549 13,281 - 48,245
    Clearview 5,587 5,242 1,462 21,206 12,251 - 45,748
    Lake Stevens 3,970 4,282 1,244 23,257 15,571 - 48,324
    Smokey Point 2,994 1,664 969 29,353 11,387 - 46,367
    Total Snohomish County 25,795 20,190 4,389 106,993 62,802 - 220,169
    Pierce County       
    University Place 2,940 53 4 1,848 1,458 - 6,303
    Gig Harbor 1,628 1,340 12 1,057 1,802 - 5,839
    Total Pierce County 4,568 1,393 16 2,905 3,260 - 12,142
            
    Brokered deposits - - - - - 50,900 50,900
            
    Total deposits$100,466$55,506$17,031$495,978$447,474$50,900$1,167,355
     

    Net loans receivable totaled $1.14 billion at December 31, 2024, compared to $1.13 billion at September 30, 2024, and $1.18 billion at December 31, 2023. The increase in the current quarter compared to the quarter ended September 30, 2024, was due to growth in non-residential commercial real estate, construction/land, consumer and one-to-four family residential loans, partially offset by declines in multifamily and business lending. The average balance of net loans receivable totaled $1.13 billion for both the quarters ended December 31, 2024, and September 30, 2024, compared to $1.17 billion for the quarter ended December 31, 2023. For the year ended December 31, 2024, the average balance of net loans receivable was $1.14 billion, compared to $1.17 billion for the year ended December 31, 2023.

    The allowance for credit losses (“ACL”) represented 1.30% of total loans receivable at December 31, 2024, compared to 1.42% of total loans receivable at September 30, 2024, and 1.28% at December 31, 2023. The change in the ACL at December 31, 2024, compared to September 30, 2024, related primarily to activity on the single lending relationship discussed above.

    Nonaccrual loans totaled $842,000 at December 31, 2024, compared to $853,000 at September 30, 2024, and $220,000 at December 31, 2023. There was no other real estate owned at December 31, 2024, September 30, 2024, or December 31, 2023.

    Net interest income totaled $8.4 million for the quarter ended December 31, 2024, compared to $8.5 million for the quarter ended September 30, 2024, and $9.3 million for the quarter ended December 31, 2023. The decrease in the current quarter compared to the quarter ended September 30, 2024, was primarily due to declines in interest from earning assets, partially offset by declines in interest expense. For the year ended December 31, 2024, net interest income totaled $34.8 million, compared to $40.5 million for the year ended December 31, 2023, as total interest expense increased by $5.0 million and total interest income declined by $800,000.

    Total interest income decreased $419,000 to $19.0 million for the quarter ended December 31, 2024, compared to $19.4 million for the quarter ended September 30, 2024, and decreased $1.3 million compared to $20.3 million for the quarter ended December 31, 2023. The decrease in total interest income during the current quarter compared to the prior quarter was primarily due to a $250,000 or 29.0% decline in interest income earned on interest-earning deposits held with banks. This decline resulted from a 54 basis point decrease in the average yield earned on these deposits, coupled with a $13.6 million reduction in their average balance. Additionally, interest income on loans, including fees, declined by $146,000 or 0.9%, primarily due to a $2.5 million decrease in the average balance of loans and, to a lesser extent, a four basis point decrease in the yield earned on loans. The decrease in total interest income during the current quarter compared to the comparable quarter in 2023 was primarily due to declines in interest income on loans, including fees, of $631,000, investments of $449,000, and interest-earning deposits with banks of $267,000, partially offset by an increase in dividends on FHLB stock of $56,000.

    Yield on loans, the largest component of our interest-earning assets, declined to 5.82% during the recent quarter, compared to 5.86% and 5.83% for the quarters ended September 30, 2024, and December 31, 2023, respectively. The yield on investment securities for the current quarter was 4.29%, down slightly from 4.30% last quarter and up from 4.11% a year ago.

    Total interest expense was $10.6 million for the quarter ended December 31, 2024, down from $11.0 million for both quarters ended September 30, 2024, and December 31, 2023. The decrease from the quarter ended September 30, 2024, was due to lower interest expense related to FHLB advances and other borrowings, which declined due to a decline in the average balance of FHLB advances and other borrowings, partially offset by higher interest expense on deposits driven by an increase in the average balance of interest-bearing deposits. The decrease from the quarter ended December 31, 2023, was due to lower interest expense on deposits and FHLB advances and other borrowings, primarily as a result of lower average balances of these liabilities.

    Net interest margin was 2.50% for the quarter ended December 31, 2024, compared to 2.46% for the quarter ended September 30, 2024, and 2.54% for the quarter ended December 31, 2023. The increase in the net interest margin for the quarter ended December 31, 2024, compared to the prior quarter was primarily due to a decline in the average balance of total interest-earning assets, as net interest income was relatively unchanged during the periods. The decrease in the net interest margin for the quarter ended December 31, 2024, compared to the same quarter a year ago was primarily due to a decline in net interest income, which was partially offset by a decline in the average balance of total interest-earning assets. The net interest margin for the month of December 2024 was 2.55%.

    Noninterest income for the quarter ended December 31, 2024, totaled $658,000, down from $677,000 for the quarter ended September 30, 2024, and up from $633,000 for the quarter ended December 31, 2023. The decrease compared to the quarter ended September 30, 2024, was primarily due to lower loan and deposit related fees and BOLI income, partially offset by an increase in wealth management revenue. Noninterest income remained nearly flat at $2.8 million for both the years ended December 31, 2024, and December 31, 2023, as increases in BOLI income, wealth management revenue and loan related fees in the current year were nearly entirely offset by decreases in deposit related fees and other noninterest income.

    Noninterest expense totaled $8.9 million for the quarter ended December 31, 2024, compared to $8.5 million for the quarter ended September 30, 2024, and $8.4 million for the quarter ended December 31, 2023. The increase from the quarter ended September 30, 2024, was primarily due to a $860,000 increase in salaries and employee benefits due to 2025 merit increases implemented in December 2024, as well as year-end accruals related to incentive compensation, partially offset by decreases in nearly all other categories, most notably professional fees and other general and administrative expenses. Incentive compensation increased due to the project that modified certain loans that would have otherwise been ineligible for Global Federal Credit Union to hold on their balance sheet. The increase compared to the quarter ended December 31, 2023, was primarily due to a $644,000 increase in salaries and employee benefits and an $87,000 increase in data processing expenses, partially offset by decreases across other expense categories. Noninterest expense totaled $36.7 million for the year ended December 31, 2024, compared to $35.7 million for the year ended December 31, 2023. The year-over-year increase was primarily due to an increase in professional fees, data processing and salaries and employee benefits, partially offset by lower marketing and other general and administrative expenses and regulatory assessments.

    First Financial Northwest, Inc. is the parent company of First Financial Northwest Bank; an FDIC insured Washington State-chartered commercial bank headquartered in Renton, Washington, serving the Puget Sound Region through 15 full-service banking offices. For additional information about us, please visit our website at ffnwb.com and click on the “Investor Relations” link at the bottom of the page.

    Forward-looking statements:

    When used in this press release and in other documents filed with or furnished to the Securities and Exchange Commission (the “SEC”), in press releases or other public stockholder communications, or in oral statements made with the approval of an authorized executive officer, the words or phrases “believe,” “will,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical facts but instead represent management’s current expectations and forecasts regarding future events many of which are inherently uncertain and outside of our control. Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, assumptions and statements about, among other things, our pending transaction with Global Federal Credit Union (“Global”) whereby Global, pursuant to the definitive purchase and assumption agreement (the “P&A Agreement”), will acquire substantially all of the assets and assume substantially all of the liabilities of the Bank, expectations of the business environment in which we operate, projections of future performance or financial items, perceived opportunities in the market, potential future credit experience, and statements regarding our mission and vision. These forward-looking statements are based on current management expectations and may, therefore, involve risks and uncertainties. Actual results may differ, possibly materially from those currently expected or projected in these forward-looking statements made by, or on behalf of, us and could negatively affect our operating and stock performance. Factors that could cause our actual results to differ materially from those described in the forward-looking statements, include, but are not limited to, the following: the occurrence of any event, change or other circumstances that could give rise to the right of one or all of the parties to terminate the P&A Agreement; delays in completing the P&A Agreement; the failure to obtain necessary regulatory approvals or to satisfy any of the other conditions to the Global transaction, including the P&A Agreement, on a timely basis or at all; delays or other circumstances arising from the dissolution of the Bank and the Company following completion of the P&A Agreement; diversion of management’s attention from ongoing business operations and opportunities during the pending Global transaction; potential adverse reactions or changes to business or employee relationships, including those resulting from the announcement of the Global transaction; adverse impacts to economic conditions in our local market areas, other markets where the Company has lending relationships, or other aspects of the Company’s business operations or financial markets, including, without limitation, as a result of employment levels, labor shortages and the effects of inflation, a recession or slowed economic growth; changes in the interest rate environment, including increases or decreases in the Federal Reserve benchmark rate and duration at which such interest rate levels are maintained, which could adversely affect our revenues and expenses, the value of assets and obligations, and the availability and cost of capital and liquidity; the impact of inflation and the current and future monetary policies of the Federal Reserve in response thereto; the effects of any federal government shutdown; increased competitive pressures, including repricing and competitors’ pricing initiatives, and their impact on our market position, loan, and deposit products; legislative and regulatory changes; the impact of bank failures or adverse developments at other banks and related negative press about the banking industry in general on investor and depositor sentiment; disruptions, security breaches, or other adverse events, failures or interruptions in, or attacks on, our information technology systems or on the third-party vendors who perform several of our critical processing functions; effects of critical accounting policies and judgments, including the use of estimates in determining the fair value of certain of our assets, which estimates may prove to be incorrect and result in significant declines in valuation; the potential effects of new tariffs or changes to existing trade policies that could affect economic activity or specific industry sectors; the effects of climate change, severe weather events, natural disasters, pandemics, epidemics and other public health crises, acts of war or terrorism, civil unrest and other external events on our business; and other factors described in the Company’s latest Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and other reports filed with or furnished to the Securities and Exchange Commission – that are available on our website at www.ffnwb.com and on the SEC’s website at www.sec.gov.

    Any of the forward-looking statements that we make in this Press Release and in the other public statements are based upon management’s beliefs and assumptions at the time they are made and may turn out to be wrong because of the inaccurate assumptions we might make, because of the factors illustrated above or because of other factors that we cannot foresee. Therefore, these factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.


    FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES
    Consolidated Balance Sheets
    (Dollars in thousands)
    (Unaudited)

    Assets Dec 31,
    2024    		  Sep 30,
    2024    		  Dec 31,
    2023    		 Three
    Month
    Change    		 One
    Year
    Change
              
    Cash on hand and in banks$9,535  $8,423  $8,391  13.2% 13.6%
    Interest-earning deposits with banks 36,182   72,884   22,138  (50.4) 63.4 
    Investments available-for-sale, at fair value 151,642   156,609   207,915  (3.2) (27.1)
    Investments held-to-maturity, at amortized cost 2,468   2,462   2,456  0.2  0.5 
    Loans receivable, net of allowance of $15,066, $16,265 and $15,306, respectively 1,140,186   1,126,146   1,175,925  1.2  (3.0)
    Federal Home Loan Bank ("FHLB") stock, at cost 5,853   5,403   6,527  8.3  (10.3)
    Accrued interest receivable 6,108   6,638   7,359  (8.0) (17.0)
    Deferred tax assets, net 2,582   2,690   2,648  (4.0) (2.5)
    Premises and equipment, net 18,166   18,584   19,667  (2.2) (7.6)
    Bank owned life insurance ("BOLI"), net 38,950   38,661   37,653  0.7  3.4 
    Prepaid expenses and other assets 9,676   8,898   10,478  8.7  (7.7)
    Right of use asset ("ROU"), net 2,357   2,473   2,617  (4.7) (9.9)
    Goodwill 889   889   889  0.0  0.0 
    Core deposit intangible, net 295   326   419  (9.5) (29.6)
    Total assets$1,424,889  $1,451,086  $1,505,082  (1.8) (5.3)
              
    Liabilities and Stockholders' Equity         
              
    Deposits         
    Noninterest-bearing deposits$80,772  $100,466  $100,899  (19.6) (19.9)
    Interest-bearing deposits 1,050,628   1,066,889   1,093,208  (1.5) (3.9)
    Total deposits 1,131,400   1,167,355   1,194,107  (3.1) (5.3)
    FHLB advances 110,000   100,000   125,000  10.0  (12.0)
    Advance payments from borrowers for taxes and insurance 2,873   5,211   2,952  (44.9) (2.7)
    Lease liability, net 2,550   2,673   2,806  (4.6) (9.1)
    Accrued interest payable 526   294   2,739  78.9  (80.8)
    Other liabilities 15,985   15,340   15,818  4.2  1.1 
    Total liabilities 1,263,334   1,290,873   1,343,422  (2.1) (6.0)
              
    Commitments and contingencies         
              
    Stockholders' Equity         
    Preferred stock, $0.01 par value; authorized 10,000,000 shares; no shares issued or outstanding -   -   -  n/a  n/a 
    Common stock, $0.01 par value; authorized 90,000,000 shares; issued and outstanding 9,230,010 shares at December 31, 2024, 9,213,969 shares at September 30, 2024, and 9,179,510 shares at December 31, 2023 93   92   92  1.1  1.1 
    Additional paid-in capital 72,823   72,916   73,035  (0.1) (0.3)
    Retained earnings 94,892   93,692   96,206  1.3  (1.4)
    Accumulated other comprehensive loss, net of tax (6,253)  (6,487)  (7,673) (3.6) (18.5)
    Total stockholders' equity 161,555   160,213   161,660  0.8  (0.1)
    Total liabilities and stockholders' equity$1,424,889  $1,451,086  $1,505,082  (1.8)% (5.3)%
     


    FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES
    Consolidated Income Statements
    (Dollars in thousands, except per share data)
    (Unaudited)

     Quarter Ended    
     Dec 31,
    2024    		  Sep 30,
    2024     		 Dec 31,
    2023    		  Three
    Month
    Change     		  One
    Year
    Change
    Interest income         
    Loans, including fees$16,512  $16,658  $17,143 (0.9)% (3.7)%
    Investments 1,694   1,744   2,143 (2.9) (21.0)
    Interest-earning deposits with banks 613   863   880 (29.0) (30.3)
    Dividends on FHLB Stock 177   150   121 18.0  46.3 
    Total interest income 18,996   19,415   20,287 (2.2) (6.4)
    Interest expense         
    Deposits 9,956   9,748   10,281 2.1  (3.2)
    FHLB advances and other borrowings 600   1,213   731 (50.5) (17.9)
    Total interest expense 10,556   10,961   11,012 (3.7) (4.1)
    Net interest income 8,440   8,454   9,275 (0.2) (9.0)
    (Recapture of provision) provision for credit losses (1,250)  1,575   - (179.4) n/a 
    Net interest income after (recapture of provision) provision for credit losses 9,690   6,879   9,275 40.9  4.5 
              
    Noninterest income         
    BOLI income 289   295   255 (2.0) 13.3 
    Wealth management revenue 88   42   60 109.5  46.7 
    Deposit related fees 226   236   234 (4.2) (3.4)
    Loan related fees 44   96   60 (54.2) (26.7)
    Other 11   8   24 37.5  (54.2)
    Total noninterest income 658   677   633 (2.8) 3.9 
              
    Noninterest expense         
    Salaries and employee benefits 5,466   4,606   4,822 18.7  13.4 
    Occupancy and equipment 1,154   1,183   1,231 (2.5) (6.3)
    Professional fees 377   585   431 (35.6) (12.5)
    Data processing 805   838   718 (3.9) 12.1 
    Regulatory assessments 160   165   196 (3.0) (18.4)
    Insurance and bond premiums 114   113   113 0.9  0.9 
    Marketing 24   46   70 (47.8) (65.7)
    Other general and administrative 834   952   858 (12.4) (2.8)
    Total noninterest expense 8,934   8,488   8,439 5.3  5.9 
    Income before federal income tax provision (benefit) 1,414   (932)  1,469 (251.7) (3.7)
    Federal income tax provision (benefit) 214   (324)  275 (166.0) (22.2)
    Net income (loss)$1,200  $(608) $1,194 (297.4)% 0.5%
              
    Basic earnings (loss) per share$0.13  $(0.07) $0.13    
    Diluted earnings (loss) per share$0.13  $(0.07) $0.13    
    Weighted average number of common shares outstanding 9,220,593   9,190,146   9,151,892    
    Weighted average number of diluted shares outstanding 9,238,565   9,190,146   9,176,724    
                   


    FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES
    Consolidated Income Statements
    (Dollars in thousands, except per share data)
    (Unaudited)

     Year Ended December 31,  
      2024   2023   One Year
    Change
    Interest income     
    Loans, including fees$66,941  $66,938  0.0%
    Investments 7,388   8,474  (12.8)
    Interest-earning deposits with banks 2,444   2,261  8.1 
    Dividends on FHLB Stock 597   485  23.1 
    Total interest income 77,370   78,158  (1.0)
    Interest expense     
    Deposits 39,117   34,407  13.7 
    FHLB advances and other borrowings 3,490   3,208  8.8 
    Total interest expense 42,607   37,615  13.3 
    Net interest income 34,763   40,543  (14.3)
    Recapture of provision for credit losses (50)  (208) (76.0)
    Net interest income after recapture of provision for credit losses 34,813   40,751  (14.6)
          
    Noninterest income     
    BOLI 1,245   1,081  15.2 
    Wealth management revenue 279   253  10.3 
    Deposit accounts related fees 923   956  (3.5)
    Loan related fees 296   275  7.6 
    Other 53   208  (74.5)
    Total noninterest income 2,796   2,773  0.8 
          
    Noninterest expense     
    Salaries and employee benefits 20,652   20,366  1.4 
    Occupancy and equipment 4,789   4,748  0.9 
    Professional fees 3,011   2,288  31.6 
    Data processing 3,285   2,857  15.0 
    Regulatory assessments 662   763  (13.2)
    Insurance and bond premiums 477   468  1.9 
    Marketing 179   343  (47.8)
    Other general and administrative 3,638   3,833  (5.1)
    Total noninterest expense 36,693   35,666  2.9 
    Income before federal income tax (benefit) provision 916   7,858  (88.3)
    Federal income tax (benefit) provision (156)  1,553  (110.0)
    Net income$1,072  $6,305  (83.0)%
          
    Basic earnings per share$0.12  $0.69   
    Diluted earnings per share$0.12  $0.69   
    Weighted average number of common shares outstanding 9,183,900   9,126,209   
    Weighted average number of diluted shares outstanding 9,238,016   9,152,617   
              

    The following table presents a breakdown of the loan portfolio (unaudited):

     December 31, 2024September 30, 2024December 31, 2023
     Amount Percent Amount Percent Amount Percent
     (Dollars in thousands)
    Commercial real estate:           
    Residential:           
    Multifamily$126,303  10.9% $132,811  11.6% $138,149  11.6%
    Total multifamily residential 126,303  10.9   132,811  11.6   138,149  11.6 
                
    Non-residential:           
    Retail 110,787  9.6   118,840  10.4   124,172  10.4 
    Office 73,306  6.3   73,778  6.5   72,778  6.1 
    Hotel / motel 72,434  6.3   54,716  4.8   63,597  5.3 
    Storage 32,229  2.8   32,443  2.8   33,033  2.8 
    Mobile home park 22,701  2.0   22,443  2.0   21,701  1.8 
    Warehouse 23,363  2.0   18,743  1.6   19,218  1.6 
    Nursing Home 9,713  0.8   11,407  1.0   11,610  1.0 
    Other non-residential 29,865  2.5   30,719  2.7   31,750  2.6 
    Total non-residential 374,398  32.3   363,089  31.8   377,859  31.6 
                
    Construction/land:           
    One-to-four family residential 49,674  4.3   42,846  3.8   47,149  4.0 
    Multifamily 7,884  0.7   7,227  0.6   4,004  0.3 
    Land development 9,582  0.8   10,148  0.8   9,771  0.8 
    Total construction/land 67,140  5.8   60,221  5.2   60,924  5.1 
                
    One-to-four family residential:           
    Permanent owner occupied 284,650  24.7   279,744  24.5   284,471  23.9 
    Permanent non-owner occupied 217,420  18.8   221,127  19.4   228,752  19.2 
    Total one-to-four family residential 502,070  43.5   500,871  43.9   513,223  43.1 
                
    Business           
    Aircraft -  0.0   -  0.0   1,945  0.1 
    Small Business Administration ("SBA") 1,729  0.2   1,745  0.2   1,794  0.3 
    Paycheck Protection Plan ("PPP") 159  0.0   238  0.0   473  0.0 
    Other business 10,247  0.9   12,416  1.1   24,869  2.1 
    Total business 12,135  1.1   14,399  1.3   29,081  2.5 
                
    Consumer           
    Classic, collectible and other auto 59,580  5.2   58,085  5.1   58,618  5.0 
    Other consumer 13,626  1.2   12,935  1.1   13,377  1.1 
    Total consumer 73,206  6.4   71,020  6.2   71,995  6.1 
    Total loans 1,155,252  100.0%  1,142,411  100.0%  1,191,231  100.0%
    Less:           
    ACL 15,066     16,265     15,306   
    Loans receivable, net$1,140,186    $1,126,146    $1,175,925   
                
    Concentrations of credit: (1)           
    Construction loans as % of total capital 40.5%    36.8%    38.3%    
    Total non-owner occupied commercial
    real estate as % of total capital    		 300.8%    296.2%    316.8%  

    (1) Concentrations of credit percentages are for First Financial Northwest Bank only using classifications in accordance with FDIC regulatory guidelines.


    FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES
    Key Financial Measures
    (Unaudited)

     At or For the Quarter Ended
     Dec 31, Sep 30, Jun 30, Mar 31, Dec 31,
      2024   2024   2024   2024   2023 
     (Dollars in thousands, except per share data)
    Performance Ratios: (1)         
    Return on assets 0.33%  (0.17)%  0.43%  (0.29)%  0.31%
    Return on equity 2.96   (1.50)  3.88   (2.67)  2.97 
    Dividend payout ratio 0.00   0.00   76.47   (108.33)  100.00 
    Equity-to-assets ratio 11.34   11.04   11.10   10.91   10.74 
    Tangible equity ratio (2) 11.26   10.97   11.02   10.83   10.66 
    Net interest margin 2.50   2.46   2.66   2.55   2.54 
    Average interest-earning assets to average interest-bearing liabilities 116.51   116.46   117.01   116.40   115.84 
    Efficiency ratio 98.20   92.96   82.35   116.97   85.17 
    Noninterest expense as a percent of average total assets 2.49   2.32   2.21   3.05   2.18 
    Book value per common share$17.50  $17.39  $17.51  $17.46  $17.61 
    Tangible book value per share (2) 17.37   17.26   17.37   17.32   17.47 
              
    Capital Ratios: (3)         
    Tier 1 leverage ratio 11.16%  10.86%  10.91%  10.41%  10.18%
    Common equity tier 1 capital ratio 15.40   15.43   15.39   14.98   14.90 
    Tier 1 capital ratio 15.40   15.43   15.39   14.98   14.90 
    Total capital ratio 16.65   16.68   16.64   16.24   16.15 
              
    Asset Quality Ratios: (4)         
    Nonaccrual loans as a percent of total loans 0.07%  0.07%  0.41%  0.02%  0.02%
    Nonaccrual loans as a percent of total assets 0.06   0.06   0.32   0.01   0.01 
    ACL as a percent of total loans 1.30   1.42   1.29   1.30   1.28 
    Net charge-offs to average loans receivable, net (0.00)  0.00   0.00   0.00   0.00 
              
    Allowance for Credit Losses:         
    ACL - loans         
    Beginning balance$16,265  $14,796  $14,996  $15,306  $15,306 
    (Recapture of provision) provision for credit losses (1,200)  1,500   (200)  (300)  - 
    Charge-offs -   (31)  -   (10)  - 
    Recoveries 1   -   -   -   - 
    Ending balance$15,066  $16,265  $14,796  $14,996  $15,306 
              
    Allowance for unfunded commitments         
    Beginning balance$639  $564  $564  $439  $439 
    (Recapture of provision) provision for credit losses (50)  75   -   125   - 
    Ending balance$589  $639  $564  $564  $439 
              
    (Recapture of provision) provision for credit losses         
    ACL - loans$(1,200) $1,500  $(200) $(300) $- 
    Allowance for unfunded commitments (50)  75   -   125   - 
    Total$(1,250) $1,575  $(200) $(175) $- 

    (1) Performance ratios are calculated on an annualized basis.
    (2) Non-GAAP financial measures. Refer to Non-GAAP Financial Measures at the end of this press release for a reconciliation to the nearest GAAP equivalents.
    (3) Capital ratios are for First Financial Northwest Bank only.
    (4) Loans are reported net of undisbursed funds.


    FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES
    Key Financial Measures
    (Unaudited)

     At or For the Quarter Ended
     Dec 31, Sep 30, Jun 30, Mar 31, Dec 31,
      2024   2024   2024   2024   2023 
     (Dollars in thousands)
    Yields and Costs: (1)         
    Yield on loans 5.82%  5.86%  5.93%  5.88%  5.83%
    Yield on investments 4.29   4.30   4.38   4.11   4.11 
    Yield on interest-earning deposits 4.73   5.27   5.25   5.28   5.32 
    Yield on FHLB stock 12.87   7.73   8.63   7.79   7.29 
    Yield on interest-earning assets 5.63%  5.66%  5.73%  5.62%  5.56%
              
    Cost of interest-bearing deposits 3.77%  3.80%  3.71%  3.69%  3.62%
    Cost of borrowings 2.35   3.19   2.64   2.65   2.40 
    Cost of interest-bearing liabilities 3.64%  3.72%  3.59%  3.58%  3.50%
              
    Cost of total deposits (2) 3.46%  3.47%  3.38%  3.38%  3.31%
    Cost of funds (2) 3.37   3.44   3.30   3.31   3.23 
              
    Average Balances:         
    Loans$1,129,019  $1,131,473  $1,139,017  $1,160,156  $1,167,339 
    Investments 156,975   161,232   173,102   202,106   206,837 
    Interest-earning deposits 51,518   65,149   36,959   37,032   65,680 
    FHLB stock 5,471   7,719   6,714   6,554   6,584 
    Total interest-earning assets$1,342,983  $1,365,573  $1,355,792  $1,405,848  $1,446,440 
              
    Interest-bearing deposits$1,051,201  $1,021,041  $1,029,608  $1,082,168  $1,127,690 
    Borrowings 101,522   151,478   129,126   125,604   120,978 
    Total interest-bearing liabilities 1,152,723   1,172,519   1,158,734   1,207,772   1,248,668 
    Noninterest-bearing deposits 93,331   96,003   101,196   99,173   102,869 
    Total deposits and borrowings$1,246,054  $1,268,522  $1,259,930  $1,306,945  $1,351,537 
              
    Average assets$1,429,788  $1,453,431  $1,446,207  $1,495,753  $1,538,955 
    Average stockholders' equity 161,093   161,569   161,057   161,823   159,659 

    (1) Yields and costs are annualized.
    (2) Includes noninterest-bearing deposits.
    (3) Includes total borrowings and deposits (including noninterest-bearing deposits).


    FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES
    Key Financial Measures
    (Unaudited)

     At or For the Year Ended December 31,
      2024   2023   2022   2021   2020 
       (Dollars in thousands, except per share data) 
    Performance Ratios:         
    Return on assets 0.07%  0.41%  0.91%  0.86%  0.63%
    Return on equity 0.66   3.93   8.34   7.65   5.50 
    Dividend payout ratio 216.67   75.36   32.65   33.59   45.45 
    Equity-to-assets ratio 11.34   10.74   10.67   11.07   11.26 
    Tangible equity ratio (1) 11.26   10.66   10.58   10.97   11.15 
    Net interest margin 2.54   2.82   3.54   3.35   3.15 
    Average interest-earning assets to average interest-bearing liabilities 116.59   116.69   119.18   118.59   115.62 
    Efficiency ratio 97.69   82.34   69.04   68.32   72.39 
    Noninterest expense as a percent of average total assets 2.52   2.33   2.44   2.35   2.39 
    Book value per common share$17.50  $17.61  $17.57  $17.30  $16.05 
    Tangible book value per share (1) 17.37   17.47   17.41   17.13   15.88 
              
    Capital Ratios: (2)         
    Tier 1 leverage ratio 11.16%  10.18%  10.31%  10.34%  10.29%
    Common equity tier 1 capital ratio 15.40   14.90   14.37   14.23   14.32 
    Tier 1 capital ratio 15.40   14.90   14.37   14.23   14.32 
    Total capital ratio 16.65   16.15   15.62   15.48   15.57 
              
    Asset Quality Ratios: (3)         
    Nonaccrual loans as a percent of total loans 0.07%  0.02%  0.02%  0.00%  0.19%
    Nonaccrual loans as a percent of total assets 0.06   0.01   0.01   0.00   0.18 
    ACL as a percent of total loans 1.30   1.28   1.29   1.40   1.36 
    Net charge-offs (recoveries) to average loans receivable, net 0.00   0.00   0.00   (0.02)  (0.00)
              
    ACL - loans         
    Beginning balance$15,306  $15,227  $15,657  $15,174  $13,218 
    Beginning balance adjustment from adoption of Topic 326 -   500   -   -   - 
    (Recapture of provision) provision for credit losses (200)  (400)  (400)  300   1,900 
    Charge-offs (41)  (22)  (37)  -   (2)
    Recoveries 1   1   7   183   58 
    Ending balance$15,066  $15,306  $15,227  $15,657  $15,174 
              
    Allowance for unfunded commitments         
    Beginning balance$439  $247  $281  $351  $428 
    Provision (recapture of provision) for credit losses 150   192   (34)  (70)  (77)
    Ending balance$589  $439  $247  $281  $351 
              
    (Recapture of provision) provision for credit losses         
    ACL - loans$(200) $(400) $(400) $300  $1,900 
    Allowance for unfunded commitments 150   192   (34)  (70)  (77)
    Total$(50) $(208) $(434) $230  $1,823 

    (1) Non-GAAP financial measures. Refer to Non-GAAP Financial Measures at the end of this press release for a reconciliation to the nearest GAAP equivalents.
    (2) Capital ratios are for First Financial Northwest Bank only.
    (3) Loans are reported net of undisbursed funds.


    FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES
    Key Financial Measures
    (Unaudited)

     At or For the Year Ended December 31,
      2024   2023   2022   2021   2020 
     (Dollars in thousands)
    Yields and Costs:         
    Yield on loans 5.87%  5.71%  4.69%  4.57%  4.69%
    Yield on investments 4.26   3.97   2.77   1.83   2.39 
    Yield on interest-earning deposits 5.12   5.06   1.28   0.12   0.21 
    Yield on FHLB stock 9.03   7.07   5.08   5.29   4.85 
    Yield on interest-earning assets 5.66%  5.44%  4.33%  4.01%  4.36%
              
    Cost of deposits 3.74%  3.12%  0.87%  0.71%  1.42%
    Cost of borrowings 2.75   2.52   1.70   1.39   1.31 
    Cost of interest-bearing liabilities 3.63%  3.05%  0.95%  0.78%  1.41%
              
    Cost of interest-bearing deposits 3.42%  2.83%  0.77%  0.64%  1.32%
    Cost of funds 3.35   2.80   0.86   0.71   1.32 
              
    Average Balances:         
    Loans$1,139,864  $1,172,569  $1,128,835  $1,098,772  $1,120,889 
    Investments 173,276   213,261   203,165   176,110   133,584 
    Interest-earning deposits 47,723   44,684   30,176   60,482   25,108 
    FHLB stock 6,614   6,857   6,256   6,271   6,600 
    Total interest-earning assets$1,367,477  $1,437,371  $1,368,432  $1,341,635  $1,286,181 
              
    Interest-bearing deposits$1,045,950  $1,104,510  $1,034,351  $1,015,852  $987,069 
    Borrowings 126,931   127,263   113,890   115,466   125,392 
    Total interest-bearing liabilities 1,172,881   1,231,773   1,148,241   1,131,318   1,112,461 
    Noninterest-bearing deposits 97,411   109,795   125,166   112,484   75,388 
    Total deposits and borrowings$1,270,292  $1,341,568  $1,273,407  $1,243,802  $1,187,849 
              
    Average assets$1,456,215  $1,529,511  $1,455,739  $1,421,476  $1,361,604 
    Average stockholders' equity 161,385   160,428   158,685   160,041   155,587 


    Non-GAAP Financial Measures

    In addition to financial results presented in accordance with generally accepted accounting principles (“GAAP”) utilized in the United States, this earnings release contains non-GAAP financial measures that include tangible equity, tangible assets, tangible book value per share, and the tangible equity-to-assets ratio. The Company believes that these non-GAAP financial measures and ratios as presented are useful for both investors and management to understand the effects of goodwill and core deposit intangible, net and provides an alternative view of the Company’s performance over time and in comparison to the Company’s competitors. Non-GAAP financial measures have limitations, are not required to be uniformly applied and are not audited. They should not be considered in isolation and are not a substitute for other measures in this earnings release that are presented in accordance with GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.

    The following tables provide a reconciliation between the GAAP and non-GAAP measures:

     Quarter Ended
      Dec 31,
    2024    		   Sep 30,
    2024    		   Jun 30,
    2024    		   Mar 31,
    2024    		   Dec 31,
    2023    		 
     (Dollars in thousands, except per share data)
    Tangible equity to tangible assets and tangible book value per share: 
    Total stockholders' equity (GAAP)$161,555  $160,213  $160,693  $160,183  $161,660 
    Less:         
    Goodwill 889   889   889   889   889 
    Core deposit intangible, net 295   326   357   388   419 
    Tangible equity (Non-GAAP)$160,371  $158,998  $159,447  $158,906  $160,352 
              
    Total assets (GAAP)$1,424,889  $1,451,086  $1,447,753  $1,468,350  $1,505,082 
    Less:         
    Goodwill 889   889   889   889   889 
    Core deposit intangible, net 295   326   357   388   419 
    Tangible assets (Non-GAAP)$1,423,705  $1,449,871  $1,446,507  $1,467,073  $1,503,774 
              
    Common shares outstanding at period end 9,230,010   9,213,969   9,179,825   9,174,425   9,179,510 
              
    Equity-to-assets ratio (GAAP) 11.34%  11.04%  11.10%  10.91%  10.74%
    Tangible equity-to-tangible assets ratio (Non-GAAP) 11.26   10.97   11.02   10.83   10.66 
    Book value per common share (GAAP)$17.50  $17.39  $17.51  $17.46  $17.61 
    Tangible book value per share (Non-GAAP) 17.37   17.26   17.37   17.32   17.47 
                        


    Non-GAAP Financial Measures (continued)
     
     Year Ended December 31,
      2024   2023   2022   2021   2020 
     (Dollars in thousands, except per share data)
    Tangible equity to tangible assets and tangible book value per share:
    Total stockholders' equity (GAAP)$161,555  $161,660  $160,360  $157,879  $156,302 
    Less:         
    Goodwill 889   889   889   889   889 
    Core deposit intangible 295   419   548   684   824 
    Tangible equity (Non-GAAP)$160,371  $160,352  $158,923  $156,306  $154,589 
              
    Total assets (GAAP) 1,424,889   1,505,082   1,502,916   1,426,329   1,387,669 
    Less:         
    Goodwill 889   889   889   889   889 
      295   419   548   684   824 
    Tangible assets (Non-GAAP)$1,423,705  $1,503,774  $1,501,479  $1,424,756  $1,385,956 
              
    Common shares outstanding at period end 9,230,010   9,179,510   9,127,595   9,125,759   9,736,875 
              
    Equity-to-assets ratio (GAAP) 11.34%  10.74%  10.67%  11.07%  11.26%
    Tangible equity ratio (Non-GAAP) 11.26   10.66   10.58   10.97   11.15 
    Book value per common share (GAAP)$17.50  $17.61  $17.57  $17.30  $16.05 
    Tangible book value per share (Non-GAAP) 17.37   17.47   17.41   17.13   15.88 


    For more information, contact:
    Joseph W. Kiley III, President and Chief Executive Officer
    Rich Jacobson, Executive Vice President and Chief Financial Officer
    (425) 255-4400


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