First Northwest Bancorp Reports $6.6 Million Net Loss for 2024

First Northwest Bancorp (FNWB) reported a net loss of $6.6 million for the year ended December 31, 2024, compared to a net income of $2.1 million in 2023. This resulted in a loss of $0.75 per common and diluted share, down from earnings of $0.26 per share in the previous year. Total assets increased slightly by 1.4% to $2.23 billion, while total shareholders' equity decreased by 5.8% to $153.9 million. The decrease in equity was attributed to the net loss, share repurchases totaling $4.1 million, and dividends paid.

Net interest income decreased by 8.3% to $56.3 million due to higher interest expense on deposit and advance balances, despite an increase in interest income from loans and investments. The net interest margin contracted to 2.74% from 3.13% in 2023, primarily due to increased interest-bearing liability costs. Noninterest income increased significantly to $12.6 million, primarily due to a gain on the sale of six branch properties ($7.9 million) and a bank-owned life insurance death benefit, partially offset by losses on the sale of securities. Noninterest expense decreased to $60.0 million, primarily due to lower advertising and professional fees and the absence of one-time write-off expenses recorded in 2023.

Significant changes in the loan portfolio included a 2.2% increase in total loans to $1.7 billion, driven by increases in commercial business loans ($39.2 million), auto and other consumer loans ($19.8 million), and one-to-four family residential loans ($16.9 million). Construction and land loans decreased by 39.8% to $78.1 million. The company also increased its investment in securities by 15.1% to $340.3 million, primarily due to purchases and improved market value. The company's nonperforming assets increased to $30.5 million (1.4% of total assets) from $18.6 million in 2023, primarily due to increases in nonperforming commercial real estate and construction loans.

The company's strategic developments included the sale and leaseback of six branch properties, generating a significant gain on sale, and the redemption and reinvestment of a limited partnership investment in Meriwether Group Capital Hero Fund LP. First Northwest also continued its investments in fintech-related businesses through various limited partnerships. The company employed 227 full-time equivalent employees at year-end. The company's outlook is not explicitly stated in the provided 10-K filing, but the risk factors section highlights potential challenges related to economic conditions, interest rates, credit quality, competition, and cybersecurity.