First Northwest Bancorp Reports $308,000 Net Income in Q2 2026, Down from $3.7 Million Last Year

First Northwest Bancorp reported a net income of $308,000 for the second quarter of 2026, a significant decrease from the $3.7 million earned in the same period last year. The decline in profitability was attributed to a $3.6 million increase in noninterest expenses, a $165,000 drop in noninterest income, and a $20,000 reduction in net interest income. For the first half of 2026, the company recorded a net income of $314,000, a recovery from a net loss of $5.4 million in the prior year, driven by a $7.9 million decrease in provisions for credit losses.

Total assets increased to $2.12 billion as of June 30, 2026, up 0.8% from $2.11 billion at the end of 2025. Cash and cash equivalents rose by 15.6% to $98.4 million, while investment securities grew by 6.2% to $287 million. However, net loans decreased by 0.9% to $1.60 billion, with notable declines in one-to-four family and multi-family loans, which fell by $19.7 million and $32.7 million, respectively. The allowance for credit losses on loans decreased to $16.3 million, representing 1.01% of total loans.

In terms of operational developments, First Northwest Bancorp has focused on diversifying its loan portfolio, increasing its origination of commercial real estate and consumer loans. The company also reported a 15.9% increase in commercial business loans, reflecting a strategic push to enhance its lending activities. The total number of shares outstanding as of July 30, 2026, was 9,511,615, with no stock repurchases made during the quarter.

Looking ahead, the company remains cautious about economic conditions and their potential impact on credit quality. Management continues to monitor the loan portfolio closely, particularly in light of recent changes in interest rates and market conditions. The outlook suggests a focus on maintaining adequate liquidity and capital levels while navigating the challenges posed by competitive pressures and regulatory requirements.