First Northwest Bancorp reported a net loss of $9.0 million for the first quarter of 2025, a significant decline from the net income of $396,000 recorded in the same period of 2024. This loss was primarily attributed to a $6.8 million increase in the provision for credit losses and a $5.7 million rise in noninterest expenses. Total interest income decreased to $26.8 million, down 1.8% from $27.3 million year-over-year, while interest expense fell to $13.0 million, a 3.1% decrease from $13.4 million in the prior year. The net interest margin remained stable at 2.76%, reflecting a balance between interest income and expense.
Total assets for First Northwest decreased by 2.7% to $2.17 billion as of March 31, 2025, compared to $2.23 billion at the end of 2024. The decline was driven by a $37.6 million reduction in net loans, which fell to $1.64 billion, and a $24.9 million decrease in investment securities, now totaling $315.4 million. The company noted a decrease in commercial business loans, which dropped by $31.7 million, while multi-family loans increased by $5.6 million. The allowance for credit losses on loans rose slightly to $20.6 million, representing 1.24% of total loans.
In terms of operational developments, First Northwest's customer deposit balances decreased by $22.0 million to $1.67 billion, with a notable shift from savings accounts to higher-yielding money market accounts and CDs. The bank's reliance on brokered deposits decreased, with a $45.0 million drop in brokered deposit balances. The company continues to focus on attracting deposits through competitive rates and promotional products, reflecting the ongoing competitive landscape for deposits.
Looking ahead, First Northwest aims to enhance its loan origination strategies, particularly in commercial real estate and consumer loans, while managing credit risk amid a challenging economic environment. The company is also focused on improving its noninterest income through various initiatives, including the management of its investment portfolio and the development of digital banking solutions. The management remains vigilant regarding economic conditions that could impact the bank's performance, particularly in light of rising interest rates and potential market volatility.
About First Northwest Bancorp
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