What changed in this filing

/stocks — the workspaceLOADING

Item 5. Market for Registrant’s Common Equity

2021-03-05 compared with 2020-03-06 · 53 added, 20 removed, 148 unchanged (33% of the section changed)

4 unchanged sentences

Prices do not include retail markups, markdowns or commissions.

First Second Third Fourth

Quarter Quarter Quarter Quarter

High $40.40 $28.75 $29.07 $34.67

Low $20.16 $19.63 $20.90 $25.48

High $39.60 $36.71 $41.82 $39.79

Low $32.36 $33.22 $34.72 $36.46

In 2020, we paid cash dividends of $0.34 per share in the first and second quarters and $0.35 per share in the third and fourth quarters.

1 unchanged sentence

Cash dividends totaled $8.9 million, $8.5 million, and $7.1 million in 2020, 2019, and 2018, respectively.

On February 27, 2020, the Board of Directors approved payment of a $0.34 per share cash dividend on March 20, 2020, to shareholders of record on March 12, 2020.

The Company and the Bank are subject to restrictions on the payment of dividends pursuant to applicable federal and state banking regulations and Alaska corporate law.

On February 25, 2021, the Board of Directors approved payment of a $0.37 subject to restrictions on the payment of dividends pursuant to applicable federal and state banking regulations and Alaska corporate law.

The dividends that the Bank pays to the Company are limited to the extent necessary for the Bank to meet the regulatory requirements of a “well-capitalized” bank.

4 unchanged sentences

The Company repurchased 327,000 shares in 2020 and 347,676 shares in 2019.

On January 27, 2020, the Board authorized the repurchase of up to an additional 327,000 shares of its common stock.

On February 1, 2021, the Company announced that its Board of Directors had authorized the repurchase of up to an additional 313,000 shares of common stock.

The Company intends to continue to repurchase its stock from time to time depending upon market conditions, but we can make no assurances that we will continue this program.

2 unchanged sentences

Additional information regarding the Company’s equity plans is presented in Note 23 of the Notes to Consolidated Financial Statements included in Item 8 of this report.

Plan Category

Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a) (2)

Plan Category Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a) (2)

Weighted-Average Exercise Price of Outstanding Options,

Warrants and Rights

Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))

Warrants and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))

Equity compensation plans approved by security holders 1

247,677 $22.12 236,700

Total 247,677 $22.12 236,700

1 Consists of the Company's 2020 Stock Incentive Plan, which replaced the 2017 Stock Incentive Plan (the "2017 Plan")

8 unchanged sentences

Period Ending

Index 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 12/31/20

Northrim BanCorp, Inc.

100.00 122.45 134.83 134.45 162.17 150.84

Russell 3000 100.00 112.74 136.56 129.40 169.54 204.95

SNL Bank $1B-$5B 100.00 143.87 153.37 134.37 163.35 138.81

4 unchanged sentences

Net interest income $70,665 $64,442 $61,208 $57,678 $56,357 $56,909 4 %

Provision (benefit) for loan losses

Provision (benefit) for loan losses 2,432 (1,175) (500) 3,200 2,298 1,754 NM

Other operating income 63,328 37,346 32,167 40,474 43,263 44,608 7 %

Compensation expense, RML acquisition payments

Compensation expense, RML acquisition payments — 468 — 130 4,775 4,094 NM

Other operating expense 89,114 76,370 69,800 71,023 71,505 68,551 5 %

1 unchanged sentence

Provision for income taxes 9,559 5,434 4,071 10,321 6,052 8,784 2 %

Net Income 32,888 20,691 20,004 13,478 14,990 18,334 12 %

Net income attributable to

noncontrolling interest

noncontrolling interest — — — 327 579 551 NM

Net income attributable to Northrim Bancorp, Inc.

$32,888 $20,691 $20,004 $13,151 $14,411 $17,783 13 %

Year End Balance Sheet

Assets $2,121,798 $1,643,996 $1,502,988 $1,518,596 $1,525,851 $1,498,691 7 %

Portfolio loans 1,444,050 1,043,371 984,346 954,953 974,074 979,682 8 %

Deposits 1,824,981 1,372,351 1,228,088 1,258,283 1,267,653 1,240,792 8 %

Securities sold under repurchase agreements — — 34,278 27,746 27,607 31,420 (100) %

Borrowings 14,817 8,891 7,241 7,362 4,338 2,120 48 %

Junior subordinated debentures 10,310 10,310 10,310 10,310 18,558 18,558 (11) %

2 unchanged sentences

Average Balance Sheet

Assets $1,936,047 $1,555,707 $1,493,385 $1,511,052 $1,506,522 $1,480,913 6 %

Earning assets 1,758,839 1,386,557 1,346,449 1,367,203 1,361,913 1,334,102 6 %

Portfolio loans 1,339,908 1,010,098 971,548 981,001 976,613 968,752 7 %

Deposits 1,638,216 1,276,407 1,227,272 1,248,333 1,250,243 1,219,445 6 %

Securities sold under repurchase agreements — 15,167 29,940 29,690 27,322 24,447 (100) %

Borrowings 25,608 8,071 7,309 5,767 4,215 14,552 12 %

Junior subordinated debentures 10,310 10,310 10,310 15,066 18,558 18,558 (11) %

7 unchanged sentences

Tangible book value per share (2)

$32.88 $29.12 $27.57 $25.70 $24.70 $22.31 8 %

Cash dividends per share $1.38 $1.26 $1.02 $0.86 $0.78 $0.74 13 %

6 unchanged sentences

Tangible common equity/tangible assets (3)

9.76 % 11.73 % 12.76 % 11.75 % 11.29 % 10.40 % (1) %

Net interest margin 4.02 % 4.65 % 4.55 % 4.22 % 4.14 % 4.27 % (1) %

Net interest margin (tax equivalent) (4)

4.05 % 4.70 % 4.60 % 4.28 % 4.20 % 4.32 % (1) %

Non-interest income/total revenue 47.26 % 36.69 % 34.45 % 41.24 % 43.43 % 43.94 % 1 %

Efficiency ratio (5)

66.47 % 75.43 % 74.68 % 72.39 % 76.44 % 71.31 % (1) %

Dividend payout ratio 26.66 % 40.79 % 35.08 % 45.44 % 37.59 % 28.81 % (2) %

2 unchanged sentences

Nonperforming assets, net of government guarantees 16,289 19,946 22,619 28,729 19,315 5,178 26 %

Nonperforming loans/portfolio loans, net of government guarantees

Net charge-offs (recoveries)/average loans

Nonperforming loans, net of government guarantees/portfolio loans 0.70 % 1.34 % 1.49 % 2.24 % 1.33 % 0.22 % 26 %

Net charge-offs (recoveries)/average loans 0.03 % (0.07) % 0.15 % 0.15 % 0.08 % 0.03 % NM

Allowance for loan losses/portfolio loans 1.46 % 1.83 % 1.98 % 2.25 % 2.02 % 1.85 % (5) %

Nonperforming assets/assets, net of government guarantees

Nonperforming assets, net of government guarantees/assets 0.77 % 1.21 % 1.50 % 1.89 % 1.27 % 0.35 % 17 %

Effective tax rate (6)

23 % 21 % 17 % 43 % 29 % 32 % (6) %

Number of banking offices (7)

17 16 16 14 14 14 4 %

Number of employees (FTE) (8)

438 431 430 429 451 441 — %

1 These unaudited schedules provide selected financial information concerning the Company that should be read in conjunction with Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" of this report.

6 unchanged sentences

See reconciliation to shareholders' equity to total assets below.

4 Tax-equivalent net interest margin is a non-GAAP performance measurement in which interest income on non-taxable investments and loans is presented on a tax-equivalent basis using a combined federal and state statutory rate of 28.43% in 2019 and 2018 and 41.11% in all other years presented.

Management believes that tax-equivalent net interest margin is a useful financial measure because it enables investors to evaluate net interest margin excluding tax expense in order to monitor our effectiveness in growing higher interest yielding assets and managing our costs of interest bearing liabilities over time on a fully tax equivalent basis.

4 Tax-equivalent net interest margin is a non-GAAP performance measurement in which interest income on non-taxable investments and loans is presented on a tax-equivalent basis using a combined federal and state statutory rate of 28.43% in 2018 through 2020 and 41.11% in all other years presented.

managing our costs of interest bearing liabilities over time on a fully tax equivalent basis.

See reconciliation to net interest margin, the comparable GAAP measurement below.

3 unchanged sentences

Other companies may define or calculate this data differently.

For additional information see the "Other Operating Expense" section in Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" of this report.

For additional information see the "Other Operating Expense" section in Part II.

Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" of this report.

See reconciliation to comparable GAAP measurement below.

6 unchanged sentences

2020 number of banking offices includes 16 full service branches and 1 loan production office.

2018 number of banking offices includes 15 full service branches and 1 loan production office.

8 FTE includes 312, 311, 320, 314, 321, and 317 Community Banking employees in 2020, 2019, 2018, 2017, 2016 and 2015, respectively.

FTE includes 126, 120, 110, 115, 130, and 124 Home Mortgage Lending employees in 2020, 2019, 2018, 2017, 2016 and 2015, respectively.

Reconciliation of Selected Financial Data to GAAP Financial Measures

These unaudited schedules provide selected financial information concerning the Company that should be read in conjunction with "Item 7.

Reconciliation of Selected Non-GAAP Financial Data to GAAP Financial Measures

These unaudited schedules provide selected financial information concerning the Company that should be read in conjunction with "Part II.

Management's Discussion and Analysis of Financial Condition and Results of Operations" of this report.

2 unchanged sentences

Total shareholders' equity $221,575 $207,117 $205,947 $192,802 $186,712 $177,214

Total assets 2,121,798 1,643,996 1,502,988 1,518,596 1,525,851 1,498,691

Total shareholders' equity to total assets ratio 10.44 % 12.60 % 13.70 % 12.70 % 12.24 % 11.82 %

3 unchanged sentences

Tangible common shareholders' equity $205,529 $191,023 $189,793 $176,578 $170,388 $153,438

Total assets $2,121,798 $1,643,996 $1,502,988 $1,518,596 $1,525,851 $1,498,691

goodwill and other intangible assets, net 16,046 16,094 16,154 16,224 16,324 23,776

1 unchanged sentence

Tangible common equity to tangible assets ratio 9.76 % 11.73 % 12.76 % 11.75 % 11.29 % 10.40 %

Reconciliation of tangible book value per share to book value per share

Reconciliation of tangible book value per share (Non-GAAP) to book value per share

(In thousands, except per share data) 2020 2019 2018 2017 2016 2015

5 unchanged sentences

goodwill and intangible assets, net 16,046 16,094 16,154 16,224 16,324 23,776

$205,529 $191,023 $189,793 $176,578 $170,388 $140,665

Divided by common shares outstanding 6,251,004 6,558,809 6,883,216 6,871,963 6,897,890 6,877,140

Tangible book value per share $32.88 $29.12 $27.57 $25.70 $24.70 $20.45

Reconciliation of tax-equivalent net interest margin to net interest margin

Reconciliation of tax-equivalent net interest margin (Non-GAAP) to net interest margin

(In Thousands) 2020 2019 2018 2017 2016 2015

Net interest income (9)

$70,665 $64,442 $61,208 $57,678 $56,357 $56,909

Divided by average interest-bearing assets 1,758,839 1,386,557 1,346,449 1,367,203 1,361,913 1,334,102

2 unchanged sentences

Net interest income (9)

$70,665 $64,442 $61,208 $57,678 $56,357 $56,909

reduction in tax expense related to

tax-exempt interest income 613 722 726 872 808 722

$71,278 $65,164 $61,934 $58,550 $57,165 $57,631

Divided by average interest-bearing assets 1,758,839 1,386,557 1,346,449 1,367,203 1,361,913 1,334,102

3 unchanged sentences

Net interest income (9)

$70,665 $64,442 $61,208 $57,678 $56,357 $56,909

Other operating income 63,328 37,346 32,167 40,474 43,263 44,608

8 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity