What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2025-02-25 compared with 2024-02-23 · 423 added, 542 removed, 2119 unchanged (31% of the section changed)

6 unchanged sentences

KPMG LLP, an independent registered public accounting firm, has audited the Consolidated Financial Statements included in this Report and has issued a report with respect to the effectiveness of the Company’s internal control over financial reporting.

Torchio /s/ William W.

Torchio, President and Chief Executive Officer (Principal Executive Officer) William W.

Harvey, Jr., Senior Executive Vice President, Chief Operating Officer and Chief Financial Officer (Principal Financial Officer)

Torchio /s/ Douglas M.

Torchio, President and Chief Executive Officer (Principal Executive Officer) Douglas M.

Schosser, Chief Financial Officer (Principal Financial Officer)

Report of Independent Registered Public Accounting Firm

4 unchanged sentences

and subsidiaries’ (the Company) internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in I nternal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statements of financial condition of the Company as of December 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, changes in shareholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2024, and the related notes (collectively, the consolidated financial statements), and our report dated February 25, 2025 expressed an unqualified opinion on those consolidated financial statements.

43 unchanged sentences

Allowance for credit losses for loans evaluated on a collective basis

As discussed in Notes 1 and 5 to the consolidated financial statements, the Company’s allowance for credit losses for loans held for investment was $125.2 million as of December 31, 2023, a portion of which included the measurement of expected credit losses on a collective (pool) basis for those loans that share similar risk characteristics.

The expected credit loss methodologies incorporate probability of default (PD) and loss given default (LGD) models to determine a PD and LGD loss assumption which is applied to loan level exposures on an undiscounted basis over the contractual term of the loans, adjusted for prepayments, certain of which use a prepayment model.

As discussed in Notes 1 and 5 to the consolidated financial statements, the Company’s allowance for credit losses for loans held for investment was $116.8 million as of December 31, 2024, a portion of which included the measurement of expected credit losses on a collective (pool) basis for all loans that share similar risk characteristics.

The expected credit loss methodologies incorporate probability of default (PD) and loss given default (LGD) to determine a PD and LGD loss assumption which is applied to loan level exposures on an undiscounted basis over the contractual term of the loans, adjusted for prepayments, certain of which use a prepayment model.

The Company uses a twenty-four-month reasonable and supportable forecast period, which is based on a probability-weighted multiple macroeconomic forecast approach (macroeconomic forecasts) and reverts to historical average loss rates over a twelve-month period for the remaining life of the loans.

1 unchanged sentence

(1) the allowance for credit losses within the residential mortgage and home equity loan portfolios are calculated using a PD, LGD, and prepayment model adjusted for asset specific characteristics at the loan-level using projected default rates, prepayment rates, and severity rates as well as macroeconomic forecasts determined at the pool level;

(2) the allowance for credit losses within the vehicle loan portfolio is calculated using a PD, LGD and prepayment model adjusted for asset specific characteristics at the loan-level using projected default rates and prepayment rates, as well as macroeconomic forecasts determined at the pool level;

(3) the allowance for credit losses for commercial real estate small business and commercial small business loan portfolios are calculated using PD and LGD models at the borrower-level using both a regression model and a fractional logit model, as well as macroeconomic forecasts and expected prepayment rates at the pool level;

and (4) the allowance for credit losses for the commercial real estate and commercial loan portfolios are calculated using PD and LGD models at the pool-level using projected

default and severity rates as well as macroeconomic forecasts and expected prepayment rates determined at the pool level.

A portion of the collective ACL is comprised of adjustments to historical loss information for asset-specific risk characteristics to reflect the extent they do not exist in the historical loss information.

(2) the allowance for credit losses within the vehicle loan portfolio is calculated using a PD, LGD, and prepayment model adjusted for asset specific characteristics at the loan-level using projected default rates and prepayment rates, as well as macroeconomic forecasts determined at

the pool level;

(3) the allowance for credit losses for commercial real estate small business and commercial small business loan portfolios are calculated using PD and LGD models at the borrower-level using both a regression model and a fractional logit model as well as macroeconomic indicators and expected prepayment rates at the pool level;

and (4) the allowance for credit losses for the commercial real estate and commercial loan portfolios are calculated using PD and LGD models at the pool-level using projected default and severity rates as well as macroeconomic forecasts and expected prepayment rates determined at the pool level.

A portion of the collective allowance for credit losses is comprised of adjustments to historical loss information for asset-specific risk characteristics to reflect the extent they do not exist in the historical loss information.

These adjustments are based on qualitative factors not reflected in the quantitative models but are likely to impact the measurement of estimated credit losses.

We identified the assessment of the expected credit losses on a collective basis for all loans, except for consumer loans (the collective ACL) as a critical audit matter.

We identified the assessment of the expected credit losses on a collective basis for all loans, except for consumer loans, (collective ACL), as a critical audit matter.

A high degree of audit effort, including specialized skills and knowledge, and subjective and complex auditor judgment was involved in the assessment of the collective ACL due to significant measurement uncertainty.

Specifically, the assessment encompassed the evaluation of the collective ACL methodologies, including the (1) PD, LGD and prepayment models and their significant assumptions, including the selection and weighting of the macroeconomic forecasts, and the reasonable and supportable forecast period, (2) adjustment for asset specific risk characteristics for residential mortgage, home equity and vehicle loans and (3) the qualitative factors and their significant assumptions.

Specifically, the assessment encompassed the evaluation of the collective ACL methodologies, including the (1) PD, LGD, and prepayment models and their significant assumptions, including the selection and weighting of the macroeconomic forecasts, and the reasonable and supportable forecast period, (2) adjustment for asset specific risk characteristics for residential mortgage, home equity, and vehicle loans and (3) the qualitative factors.

The assessment also included an evaluation of the conceptual soundness and performance of the models.

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• development of the collective ACL methodologies

• development of the small business banking PD, LGD and prepayment models

• continued use and conceptual soundness of the PD, LGD, and prepayment models

1 unchanged sentence

• determination and measurement of the significant assumptions used in the models

• determination of the qualitative factors, including the significant assumptions used in the measurement of the qualitative factors

• determination of the methodology used to develop the qualitative factors

• analysis of the collective ACL results, trends, and ratios

7 unchanged sentences

• evaluating the length of the reasonable and supportable forecast period by comparing it to specific portfolio risk characteristics and trends

• evaluating the methodology used to develop the qualitative factors and the effect of certain factors on the collective ACL compared with relevant credit risk factors and consistency with credit trends.

We also assessed the sufficiency of the audit evidence obtained related to the collective ACL estimate by evaluating the cumulative results of the audit procedures, qualitative aspects of the Company’s accounting practices, and potential bias in the accounting estimate.

• evaluating the methodology used to develop the qualitative factors

We also assessed the sufficiency of the audit evidence obtained related to the collective ACL by evaluating the cumulative results of the audit procedures, qualitative aspects of the Company’s accounting practices, and potential bias in the accounting estimate.

We have served as the Company’s auditor since 1963.

73 unchanged sentences

Trust and other financial services income 30,102 27,284 27,765

Insurance commission income — — 3,633

Gain on real estate owned, net 887 2,006 603

1 unchanged sentence

Mortgage banking income 2,321 2,431 4,865

Gain on sale of insurance business — — 25,327

Other operating income 20,010 11,776 15,307

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Diluted earnings per share $ 0.79 1.06 1.05

(1) Reclassified from other expenses for periods prior to December 31, 2023

See accompanying notes to Consolidated Financial Statements.

8 unchanged sentences

Net unrealized holding gains/(losses) on marketable securities:

Unrealized holding gains/(losses), net of tax of $( 3,429 ), $ 45,321 , and $ 10,333 , respectively

Unrealized holding (losses)/gains, net of tax of $ 1,193 , $( 3,429 ), and $ 45,321 , respectively

( 6,378 ) 7,875 ( 151,888 )

3 unchanged sentences

Change in fair value of interest rate swaps, net of tax of $( 448 ), $ 110 , and $ 0 , respectively

1,533 ( 374 ) —

Defined benefit plan:

24 unchanged sentences

Exercise of stock options 4 5,169 — — 5,173

Share repurchases ( 18 ) ( 23,836 ) — — ( 23,854 )

Stock-based compensation expense 1 4,073 — — 4,074

8 unchanged sentences

Total comprehensive income — — 134,957 21,666 156,623

Adoption of ASU No.

2022-02 — — ( 329 ) — ( 329 )

Exercise of stock options 1 629 — — 630

9 unchanged sentences

Total comprehensive income — — 100,278 38,578 138,856

Adoption of ASU No.

2022-02 — — ( 329 ) — ( 329 )

Exercise of stock options 2 2,453 — — 2,455

Stock-based compensation expense 2 6,080 — — 6,082

Stock-based compensation forfeited ( 1 ) 1 — — —

Dividends paid ($ 0.80 per share)

13 unchanged sentences

Loss on sale of investments 39,413 8,307 —

Net loss/(gain) on sale of assets 2,117 42 ( 1,201 )

Net (gain)/loss on sale of assets ( 11,871 ) 2,117 42

Mortgage banking activity ( 3,210 ) ( 895 ) ( 3,512 )

2 unchanged sentences

Gain on sale of loans — ( 726 ) —

Gain on sale of insurance business — — ( 25,327 )

Net depreciation, amortization and accretion 21,340 24,497 6,448

(Increase)/decrease in other assets ( 117,813 ) ( 33,751 ) 22,163

Increase in other assets ( 2,185 ) ( 117,813 ) ( 33,751 )

Increase in other liabilities 8,187 21,771 19,775

2 unchanged sentences

Noncash write-down of real estate owned 6,697 100 54

Deferred income tax (benefit)/expense ( 4,920 ) ( 5,504 ) 12,314

Deferred income tax expense/(benefit) 2,803 ( 4,920 ) ( 5,504 )

Origination of loans held-for-sale ( 268,179 ) ( 198,637 ) ( 362,867 )

17 unchanged sentences

Proceeds from sale of real estate owned for investment, net — — 305

Purchases of premises and equipment ( 8,564 ) ( 4,320 ) ( 17,517 )

Proceeds from sale of insurance business — — 28,238

Net cash used in investing activities ( 239,680 ) ( 917,423 ) ( 232,970 )

Purchases of premises and equipment, net ( 2,308 ) ( 8,564 ) ( 4,320 )

Net cash provided by/(used in) investing activities 174,974 ( 239,680 ) ( 917,423 )

NORTHWEST BANCSHARES, INC.

10 unchanged sentences

Proceeds from stock options exercised 2,455 630 5,173

Purchase of common stock for retirement — — ( 23,854 )

Net cash provided by/(used in) financing activities 129,685 ( 397,902 ) 570,494

Net (decrease)/increase in cash and cash equivalents $ ( 17,105 ) ( 1,139,894 ) 542,982

Net cash (used in)/provided by financing activities ( 136,523 ) 129,685 ( 397,902 )

Net increase/(decrease) in cash and cash equivalents $ 166,118 ( 17,105 ) ( 1,139,894 )

Cash and cash equivalents at beginning of period $ 122,260 139,365 1,279,259

Net (decrease)/increase in cash and cash equivalents ( 17,105 ) ( 1,139,894 ) 542,982

Net increase/(decrease) in cash and cash equivalents 166,118 ( 17,105 ) ( 1,139,894 )

Cash and cash equivalents at end of period $ 288,378 122,260 139,365

32 unchanged sentences

On a quarterly basis, we measure expected credit losses on held-to-maturity debt securities on a collective basis by major security type and all of our held-to-maturity debt securities are residential mortgage-backed securities.

Accrued interest receivable on held-to-maturity debt securities total ed $ 2.5 million and $ 2.8 million at December 31, 2023 and December 31, 2022, respectively, and is excluded from estimated credit losses.

Accrued interest receivable on held-to-maturity debt securities total ed $ 3 million at both December 31, 2024 and December 31, 2023, respectively, and is excluded from estimated credit losses.

All of our r esidential mortgage-backed securities are issued by U.S.

government entities and agencies.

These securities are either explicitly or implicitly guaranteed by the U.S.

government, are highly rated by major rating agencies and have a long history of no credit losses.

For available-for-sale debt securities in an unrealized loss position, on at least a quarterly basis, we review our investments for impairment.

6 unchanged sentences

If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security is compared to the amortized cost basis of the security.

If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is

If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than amortized cost.

Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income.

NORTHWEST BANCSHARES, INC.

2 unchanged sentences

December 31, 2024, 2023 and 2022

recorded for the credit loss, limited by the amount that the fair value is less than amortized cost.

Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income.

Changes in the allowance for credit losses are recorded as provision for (or reversal of) credit loss expense.

Losses are charged against the allowance when we believe the uncollectibility of an available-for-sale security is confirmed or when there is an intent or requirement to sell the security.

Accrued interest receivable on available-for-sale debt securities totale d $ 1.6 million and $ 2.0 million at December 31, 2023 and December 31, 2022, respectively , and is excluded from the estimate of credit losses.

Accrued interest receivable on available-for-sale debt securities totale d $ 2 million at both December 31, 2024 and December 31, 2023, respectively , and is excluded from the estimate of credit losses.

A debt security is placed on nonaccrual status at the time any principal or interest payments become 90 days past due.

4 unchanged sentences

Additionally, the class of financing receivables are based on several factors including the method for monitoring and assessing credit risk and the risk characteristics of the financing receivables.

Based on evaluation of the nature of our financing receivables, along with the nature and extent of exposure to credit risk arising from these receivables, our portfolio segments were determined to be Personal Banking and Business Banking loans.

• Personal Banking loans consist of the following classes of financing receivables:

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◦ Home equity loans - first and second mortgage loans and home equity lines of credit

◦ Vehicle loans - direct and indirect automobile and motorcycle loans

◦ Vehicle loans - direct and indirect automobile, motorcycle loans and recreational or power sport vehicles

◦ Consumer loans - unsecured lines of credit, credit card loans, and other consumer loans

• Business Banking loans consist of the following classes of financing receivables:

◦ Commercial real estate - multi-family commercial real estate loans are secured by multi-family residences, such as rental properties and loans secured by nonresidential properties such as hotels, commercial offices, medical buildings, manufacturing facilities and retail establishments, excluding owner-occupied loans, and including small business commercial real estate loans

• Commercial Banking loans consist of the following classes of financing receivables:

◦ Commercial real estate - multi-family commercial real estate loans secured by multi-family residences, such as rental properties and loans secured by nonresidential properties such as hotels, commercial offices, medical buildings, manufacturing facilities and retail establishments, excluding owner-occupied loans, and including small business commercial real estate loans

◦ Commercial real estate - owner-occupied loans - commercial real estate loans secured by residential or non-residential properties

1 unchanged sentence

Loans are reported at amortized cost.

Amortized cost is the principal balance outstanding, net of any deferred purchased premiums an d discounts, deferred origination fees or costs and the allowance for credit losses.

Amortized cost is the principal balance outstanding, net of any deferred purchase premiums an d discounts, deferred origination fees or costs and the allowance for credit losses.

Accrued interest receivable totaled $ 40 million and $ 42 million at December 31, 2024 and December 31, 2023, respectively, and was reported in accrued interest receivable on the Consolidated Statements of Financial Condition.

8 unchanged sentences

When principal forgiveness is provided, the amount of forgiveness is charged off against the allowance for credit losses.

Loan delinquency is measured based on the number of days since the payment due date.

Past due status is measured using the loan’s contractual maturity date.

NORTHWEST BANCSHARES, INC.

2 unchanged sentences

December 31, 2024, 2023 and 2022

Loan delinquency is measured based on the number of days since the payment due date.

Past due status is measured using the loan’s contractual maturity date.

Personal Banking loans are charged-off or charged down when they become 180 da ys delinquent, unless the borrower has filed for bankruptcy.

Business Banking loans are charged-off or charged down when, in our opinion, they are no longer collectible or when it has been determined that the collateral value no longer supports the carrying value of the loan for loans that are collateral dependent.

Commercial Banking loans are charged-off or charged down when, in our opinion, they are no longer collectible or when it has been determined that the collateral value no longer supports the carrying value of the loan for loans that are collateral dependent.

Loan fees and certain direct loan origination costs are deferred and the net deferred fee or cost is then recognized using the level-yield method over the contractual life of the loan as an adjustment to interest income.

We identify certain residential mortgage loans and small business administration guaranteed loans which will be sold prior to maturity, as loans held-for-sale.

We identify certain residential mortgage loans, small business administration guaranteed loans and commercial loans which will be sold prior to maturity, as loans held-for-sale.

These loans are recorded at fair value less estimated cost to sell.

3 unchanged sentences

Acquired loans may be classified as PCD loans upon acquisition if they have experienced more than insignificant credit deterioration since origination.

Loans are considered to have experienced more than insignificant credit deterioration if they are greater than 30 days past due, classified special mention or worse or on nonaccrual status.

An allowance for credit losses on day 1 is determined using the same methodology as other loans held for investment.

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Expected credit losses are estimated over the contractual term of the loans, adjusted for prepayments.

The contractual term excludes expected extensions, renewals and modifications or the extension or renewal option is included in the contract and is not unconditionally cancellable by the Company.

The contractual term includes extension or renewal option included in the contract that are outside of our control and is not unconditionally cancellable by the Company.

Credit card receivables do not have stated maturities.

11 unchanged sentences

As part of the analysis as of December 31, 2024, we considered the most recent macroeconomic forecasts available.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

Mortgage and Home Equity Loans

2 unchanged sentences

lines versus loans, fixed versus variable, senior lien position versus junior lien position, among other things.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

For each pool, the models project default rates, prepayment rates, and severity rates.

33 unchanged sentences

The models ’ overall key inputs are borrower and collateral characteristics and macroeconomic forecasts including real GDP, unemployment, home price appreciation, and real disposable personal income.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

Commercial Loans and Commercial Real Estate - Owner Occupied Loans

2 unchanged sentences

The commercial loan portfolio and the commercial real estate owner occupied loan portfolio models project default and severity rates.

The model accepts as inputs key risk drivers such as the obligor financial statement information, collateral type, the obligor’s primary industry, expected prepayment rates, among other characteristics.

The model accepts as inputs key risk drivers such as the obligor financial statement information, collateral type, the obligor’s primary

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

industry, expected prepayment rates, among other characteristics.

It also utilizes macroeconomic forecasts of unemployment rates, gross domestic product, corporate bond spreads, and others.

27 unchanged sentences

Any initial write-down is charged to the allowance for credit losses.

Subsequently, foreclosed assets are valued at the lower of the amount recorded at acquisition date or the current fair value, less

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

estimated disposition costs.

Subsequently, foreclosed assets are valued at the lower of the amount recorded at acquisition date or the current fair value, less estimated disposition costs.

Any subsequent write-down or gains or losses realized from the disposition of such property are credited or charged to noninterest income.

4 unchanged sentences

Dividends are reported in interest income in the Consolidated Statements of Income.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

(i) Premises and Equipment

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The intangible, which is recorded in other intangible assets, is then amortized to expense on an accelerated basis over an approximate life of typically betwe en seven to eleven years .

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

(l) Bank-Owned Life Insurance

3 unchanged sentences

In the event of the death of an insured individual covered by these policies, after distribution to the insured’s beneficiaries, if any, we receive a tax-free death benefit, which is recorded as noninterest income.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

Interest on deposits is accrued and charged to expense monthly and is paid or credited in accordance with the terms of the accounts.

4 unchanged sentences

(o) Pension Plans

We maintain multiple noncontributory defined benefit pension plans (“Pension Plan”) for substantially all of our employees.

We maintain multiple noncontributory defined benefit pension plans (“Pension Plan”) for certain of our employees.

The net periodic pension cost has been calculated using service cost, interest cost, expected returns on plan assets and net amortization.

13 unchanged sentences

If current available information raises doubt as to the realization of the deferred tax assets, a valuation allowance is established.

(q) Stock-Related Compensation

Stock-based compensation awards granted, comprised of performance and time-based restricted stock units, stock options, and restricted stock awards, are valued at fair value and compensation cost is recognized on a straight-line basis over the requisite service or performance period of each award.

For service-based awards compensation will be recognized pro rata over the periods in which the shares vest.

F or performance-based awards, compensation expense is recognized evenly over the performance period, based on the probability of the achievements of the performance conditions set forth in the plans.

Forfeitures are recognized as they occur.

For restricted stock awards, the recipients are entitled to all shareholder rights, except that the shares may not be sold, pledged, or

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

otherwise disposed of and are required to be held in a trust.

For restricted stock units and performance stock units, the recipients are not entitled to any of the shareholder rights.

We determine the fair value of each option award, estimated on the grant date, using the Black-Scholes-Merton option-pricing model.

The Black-Scholes-Merton option-pricing model uses variables including expected volatilities, expected term, risk-free discount rate and annual rate of quarterly dividends.

Expected volatilities are based on historical volatility of the Company’s stock.

The expected terms are based upon actual exercise and forfeiture experience of previous option grants.

The risk-free rate is based on yields on U.S.

Treasury securities of a similar maturity to the expected term of the options.

During the years ended December 31, 2023 and 2022 we awarded no stock options to employees or directors.

New shares are issued when options are exercised.

Option awards are generally granted with an exercise price equal to the closing market price of the Company’s stock on the day before the grant date.

Stock-based employee compensation expense related to common share awards of $ 4.3 million, $ 2.8 million and $ 4.1 million was included in income before income taxes during the years ended December 31, 2023, 2022 and 2021, respectively.

The effect on net income for the years ended December 31, 2023, 2022 and 2021 was a reduction of $ 3.1 million, $ 2.0 million and $ 2.9 million, respectively.

Total compensation expense for unvested stock options of $ 332,000 has yet to be recognized as of December 31, 2023.

The weighted average period over which this remaining stock option expense will be recognized is approximately 3.08 years.

(q) Stock-Based Compensation

Stock-based compensation expense is recognized based on the grant-date fair value of stock-based awards that are expected to vest over the requisite service period.

All awards, both those with cliff vesting and graded vesting, are expensed on a straight-line basis over the requisite service period.

As compensation expense is recognized, a deferred tax asset is recorded that represents an estimate of the future tax deduction from exercise or release of restrictions.

At the time awards are exercised, cancelled, expire or restrictions are released, the we recognize an adjustment to income tax expense for the difference between the previously estimated tax deduction and the actual tax deduction realized.

We account for forfeitures as they occur.

For additional information regarding grants of stock options and common shares, see Note 15.

5 unchanged sentences

Those methods must be consistent with our approach to managing risk.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

At times, we utilize interest rate swap agreements as part of the management of interest rate risk to hedge the interest rate risk on floating rate borrowings.

8 unchanged sentences

Changes to the fair value of assets and liabilities arising from these derivatives are included, net, in other operating income in the Consolidated Statement of Income.

We offset the fair value amounts recognized for derivative instruments and the fair value for the right to reclaim cash collateral or the obligation to return cash collateral arising from derivative instruments recognized at fair value executed with the same counterparty under a master netting arrangement.

(s) Off-Balance-Sheet Instruments

4 unchanged sentences

Operating lease right of use (“ROU ” ) assets represent our right to use an underlying asset during the lease term and operating lease liabilities represent our obligation to make lease payments arising from the lease.

ROU assets and operating

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

lease liabilities are recognized at lease commencement based on the present value of the remaining lease payments.

ROU assets and operating lease liabilities are recognized at lease commencement based on the present value of the remaining lease payments.

ROU assets are further adjusted for lease incentives and initial direct costs.

11 unchanged sentences

(u) Use of Estimates

The preparation of financial statements, in conformity with accounting principles generally accepted in the United States of America, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amount of revenues and expenses during the reporting period.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

contingent assets and liabilities at the date of the financial statements, and the reported amount of revenues and expenses during the reporting period.

The estimate and assumptions that we deem important to our financial statements relate to the allowance for credit losses.

5 unchanged sentences

These reclassifications had no effect on the reported results of operations.

An adjustment has been made to the Consolidated Statements of Income and Consolidated Statements of Cash Flows for the years ended December 31, 2022 and December 31, 2021, to reclassify the provision for credit losses - unfunded commitments, previously presented in other expense, to provide additional transparency to financial statement users.

(2) Recently Adopted Accounting Standards

In March 2023, the Financial Accounting Standards Board (“FASB ” ) issued Accounting Standards Update (“ASU ” ) No.

2022-02, “Financial Instruments - Credit Losses (Topic 326):

Troubled Debt Restructurings and Vintage Disclosure.” This ASU eliminates the accounting guidance for troubled debt restructurings (“TDRs”), while enhancing disclosure requirements for certain loan modifications when a borrower is experiencing financial difficulty.

This ASU also requires the disclosure of current period gross write-offs by year for origination for financing receivables.

This guidance is effective for annual periods beginning after December 15, 2022, including interim periods within those years, with early adoption permitted.

This ASU is applied prospectively to modifications and write-offs beginning on the first day of the fiscal year of adoption.

An entity may elect to adopt a modified retrospective transition method on the recognition and measurement of the TDR guidance.

We adopted ASU 2022-02 using a modified retrospective transition approach related to the recognition and measurement of the TDR guidance and on a prospective basis for modification and write-offs.

As a result, the Company was not required to adjust its comparative period financial information for effects of the standard or make the new required ASU 2022-02 disclosure for periods before the date of adoption (i.e.

January 1, 2023).

This change did not have a material effect on our consolidated financial statements.

In March 2020, the FASB issued ASU No.

2020-04, “Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” This ASU provides temporary optional guidance on contract modifications and hedge accounting to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

guidance provides expedients and exceptions for applying GAAP to transactions affected by reference rate reform if certain criteria are met.

The amendments primarily include contract modifications and hedge accounting, as well as providing a one-time election for the sale or transfer of debt securities classified as held-to-maturity.

This guidance was effective as of March 12, 2020 through December 31, 2022.

In December 2022, the FASB issued ASU No.

2022-06, “Reference Rate Reform (Topic 848):

Deferral of the Sunset Date to Topic 848”.

This guidance extends the guidance of ASU 2022-04 from December 31, 2022 to December 31, 2024.

In January 2021, the FASB issued ASU No.

2021-01, “Reference Rate Reform.” This ASU provides amendments, which are elective, and apply to all entities that have derivative instruments that use an interest rate for margining, discounting or contract price alignment of certain derivative instruments that are modified as a result of the reference rate reform.

This ASU is effective upon issuance through December 31, 2024, and can be adopted at any time during this period.

During the current year, we completed our LIBOR transition plan and modified the Company’s loan and other financial instrument contracts that are impacted by the transition.

The Company chose the Secured Overnight Financing Rate (“SOFR”) as its alternative replacement for LIBOR on both back-to-back swaps and variable rate loans.

There was no material impact to the Company’s financial statements as a result of the transition.

2023-02, “Investments—Equity Method and Joint Ventures (Topic 323):

Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method.

” This ASU allows reporting entities to elect to account for qualifying tax equity investments using the proportional amortization method, regardless of the program giving rise to the related income tax credits.

Entities must make an accounting policy election to apply the proportional amortization method on a tax credit-program-by-tax-credit-program basis.

The ASU’s amendments also remove the specialized guidance for low-income-housing tax credit (“LIHTC ” ) investments that are not accounted for using the proportional amortization method and instead require that those LIHTC investments be accounted for using the guidance in other accounting standards.

This guidance is effective for fiscal years beginning after December 15, 2023, with early adoption permitted.

This ASU is applied on a modified retrospective or retrospective basis with the amendments to remove the specialized guidance for LIHTCs also being able to be applied on a prospective basis.

This guidance was adopted on January 1, 2024 and did not have a material impact to the Company’s financial statements.

In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures ” to improve disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

This update requires that an entity that has a single reportable segment, such as the Company, to provide all the disclosures required by this update.

The amendments in this update require annual and interim disclosures on significant segment expenses that are regularly provided to the chief operating decision maker to make operating decisions and to allocate resources.

The amendments in this update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

A public entity should apply the amendments in this update retrospectively to all prior periods presented in the consolidated financial statements with early adoption permitted.

This guidance was adopted for the year ended December 31, 2024 and did not have a material impact on the Company’s financial statements.

Lease expense for these leases is recognized on a straight-line basis over the lease term, with variable lease payments recognized in the period those payments are incurred.

10 unchanged sentences

Operating lease liabilities (other liabilities) 49,973 64,723

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

Other information related to leases were as follows:

6 unchanged sentences

Weighted average discount rate 4.6 % 4.2 %

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

Amounts disclosed for ROU assets obtained in exchange for lease obligations include amounts added to the carrying amount of ROU assets resulting from lease modifications and reassessments.

6 unchanged sentences

Rental expense for the years ended December 31, 2024, 2023 and 2022 was $ 8 million , $ 7 million and $ 7 million, respectively.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

(4) Marketable Securities

5 unchanged sentences

government and agencies:

Due after one year through five years $ 20,000 — ( 1,135 ) 18,865

Due after ten years $ 45,289 — ( 9,898 ) 35,391

1 unchanged sentence

Due after one year through five years 122 — ( 4 ) 118

Due after five years through ten years 386 — ( 12 ) 374

Municipal securities:

3 unchanged sentences

Corporate debt issues:

Due after one year through five years 5,485 — ( 78 ) 5,407

Due after five years through ten years 19,944 815 ( 65 ) 20,694

6 unchanged sentences

Total marketable securities available-for-sale $ 1,278,665 1,197 ( 170,918 ) 1,108,944

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

Marketable securities held-to-maturity at December 31, 2024 are as follows:

4 unchanged sentences

Due after one year through five years $ 124,462 — ( 14,464 ) 109,998

Due after five years through ten years 54,987 — ( 8,700 ) 46,287

Residential mortgage-backed securities:

5 unchanged sentences

Total marketable securities held-to-maturity $ 750,586 1 ( 112,639 ) 637,948

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

Marketable securities available-for-sale at December 31, 2023 are as follows:

10 unchanged sentences

Municipal securities:

Due within one year 506 — ( 1 ) 505

Due after one year through five years 4,279 22 ( 427 ) 3,874

10 unchanged sentences

Total marketable securities available-for-sale $ 1,240,003 223 ( 196,867 ) 1,043,359

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

Marketable securities held-to-maturity at December 31, 2023 are as follows:

21 unchanged sentences

Total residential mortgage-backed securities $ 1,139,018 988,707

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

The following table shows the contractual maturity of our residential mortgage-backed securities held-to-maturity at December 31, 2024:

1 unchanged sentence

Residential mortgage-backed securities:

Due within one year $ 24 24

Due after one year through five years 19,957 18,020

10 unchanged sentences

Marketable securities having a carrying value of $ 615 million at December 31, 2024 were pledged under collateral agreements.

During the year ended December 31, 2024, we sold marketable securities classified as available-for-sale for $ 276 million, with gross realized losses of $ 39 million.

During the year ended December 31, 2023, we sold marketable securities classified as available-for-sale for $ 101 million, with gross realized gains of $ 9,000 and gross realized losses of $ 8 million.

During the year ended December 31, 2022, there were no sales of marketable securities classified as available-for-sale.

During the year ended December 31, 2021, we sold marketable securities classified as available-for-sale for $ 59.6 million, with gross realized gains of $ 410,000 and gross realized losses of $ 396,000 .

During the years ended December 31, 2024, 2023, and 2022, we did no t recognize an allowance for credit losses in our investment portfolio.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

The following table shows the fair value and gross unrealized losses on available for sale investment securities and held to maturity investment securities, for which an allowance for credit losses has not been recorded, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position at December 31, 2024:

8 unchanged sentences

Total temporarily impaired securities $ 313,235 ( 3,764 ) 1,310,418 ( 279,793 ) 1,623,653 ( 283,557 )

The following table shows the fair value and gross unrealized losses on investment securities available for sale investment securities and held to maturity investment securities, for which an allowance for credit losses has not been recorded, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position at December 31, 2022:

Less than 12 months 12 months or more Total

7 unchanged sentences

Total temporarily impaired securities $ 20,729 ( 323 ) 1,704,010 ( 311,878 ) 1,724,739 ( 312,201 )

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

The Company does not believe that the available-for-sale debt securities that were in an unrealized loss position as of December 31, 2024, which were comprised of 288 individual securities, represents a credit loss impairment.

23 unchanged sentences

Total marketable securities held-to-maturity $ 750,586 750,586

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

(5) Loans Receivable

The following tables excludes loans held for sale.

The following table shows a summary of our loans receivable at amortized cost basis at December 31, 2024 and December 31, 2023 (in thousands):

17 unchanged sentences

(2) Includes loans subject to purchase accounting in a business combination.

(3) Includes $ 8.8 million and $ 9.9 million of loans held-for-sale at December 31, 2023 and December 31, 2022, respectively.

(3) Includes $ 60 million and $ 68 million of net unearned income, unamortized premiums and discounts and deferred fees and costs at December 31, 2024 and December 31, 2023, respectively.

During the year ended December 31, 2022, the Company purchased a total of $ 182.8 million small business equipment finance loan pools and a total of $ 188.3 million one- to four-family jumbo mortgage loan pools.

No loans were purchased during the year ended December 31, 2023.

As of December 31, 2023 and 2022, we serviced loans for others approximating $ 230.8 million and $ 1.549 billion, respectively.

These loans serviced for others are not our assets and are not included in our financial statements.

As of December 31, 2023 and 2022, approximately 38 % and 41 % of our loan portfolio was secured by properties located in Pennsylvania.

We do not believe we have significant concentrations of credit risk to any one group of borrowers given our underwriting and collateral requirements.

Loans receivable as of December 31, 2023 and 2022 include $ 4.032 billion and $ 3.333 billion, respectively, of adjustable rate loans and $ 7.314 billion and $ 7.511 billion, respectively, of fixed rate loans.

NORTHWEST BANCSHARES, INC.

2 unchanged sentences

December 31, 2024, 2023 and 2022

As of December 31, 2024 and 2023, we serviced loans for others approximating $ 244 million and $ 231 million, respectively.

These loans serviced for others are not our assets and are not included in our financial statements.

As of December 31, 2024 and 2023, approximately 36 % and 38 % of our loan portfolio was secured by properties located in Pennsylvania.

We do not believe we have significant concentrations of credit risk to any one group of borrowers given our underwriting and collateral requirements.

Loans receivable as of December 31, 2024 and 2023 include $ 4.3 billion and $ 4.0 billion, respectively, of adjustable rate loans and $ 6.9 billion and $ 7.3 billion, respectively, of fixed rate loans.

The following table provides information related to the allowance for credit losses by portfolio segment and by class of financing receivable for the year ended December 31, 2024 (in thousands):

Balance as of December 31, 2024 Current

period provision Charge-offs Recoveries ASU 2022-02 Adoption Balance as of December 31, 2022

period provision Charge-offs Recoveries Balance as of December 31, 2023

Allowance for Credit Losses

25 unchanged sentences

Total off-balance-sheet exposure $ 13,949 ( 3,174 ) — — 17,123

(1) The table above has been revised to reflect the correct ending balance for total off-balance-sheet exposure at December 31, 2022.

We evaluated the effect of the revision, both qualitatively and quantitatively, and concluded that the impact of the revision was not material.

During the year ended December 31, 2023, we sold $ 8.0 million of loans that were classified as held-for-investment, for a gain of $ 726,000 , which is reported in gain on sale of loans on the Consolidated Statements of Income.

During the year ended December 31, 2024, we sold $ 24 million of loans that were classified as held-for-investment, for a loss of $ 5 million, which is reported in provision for credit losses in the Consolidated Statements of Income.

NORTHWEST BANCSHARES, INC.

4 unchanged sentences

Balance as of December 31, 2023 Current

period provision Charge-offs Recoveries Balance as of December 31, 2021

period provision Charge-offs Recoveries ASU 2022-02 Adoption Balance as of December 31, 2022

Allowance for Credit Losses

23 unchanged sentences

Total off-balance-sheet exposure $ 17,123 4,210 — — — 12,913

(1) The table above has been revised to reflect the correct ending balance for total off-balance-sheet exposure at December 31, 2022.

We evaluated the effect of the revision, both qualitatively and quantitatively, and concluded that the impact of the revision was not material.

NORTHWEST BANCSHARES, INC.

50 unchanged sentences

Total $ 11,180,014 116,819 61,401 656

The following table provides information related to the loan portfolio by portfolio segment and by class of financing receivable at December 31, 2022, prior to the adoption of ASU 2022-02 (in thousands):

The following table provides information related to the loan portfolio by portfolio segment and by class of financing receivable at December 31, 2023 (in thousands):

receivable Allowance for

credit losses Nonaccrual

loans (1) Loans 90 days past due and accruing TDRs Allowance

TDRs Additional

classified as

loans Loans 90 days past due and accruing

Personal Banking:

10 unchanged sentences

Total $ 11,406,041 125,243 94,384 2,698

(1) Includes $ 29.2 million of nonaccrual TDRs.

NORTHWEST BANCSHARES, INC.

20 unchanged sentences

Total $ 94,384 45,014 16,387 61,401 656

During the year ended December 31, 2023, we did not recognize any interest income on nonaccrual loans.

During the year ended December 31, 2024, we did no t recognize any interest income on nonaccrual loans.

The following table presents the amortized cost of our loans on nonaccrual status as of the beginning and end of the year ended December 31, 2023, (in thousands):

14 unchanged sentences

Total $ 81,236 68,835 25,549 94,384 2,698

During the year ended December 31, 2022, we recognized $ 678,000 of interest income on nonaccrual and troubled debt restructuring loans.

During the year ended December 31, 2023, we did no t recognized any interest income on nonaccrual loans.

NORTHWEST BANCSHARES, INC.

4 unchanged sentences

The following table presents the amortized cost basis of collateral-dependent loans by class of loans as of December 31, 2024 (in thousands):

Real estate Total

Real estate Equipment Other Total

Commercial Banking:

4 unchanged sentences

The following table presents the amortized cost basis of collateral-dependent loans by class of loans as of December 31, 2023 (in thousands):

Real estate Equipment Total

Personal Banking:

Residential mortgage loans $ 569 — 569

Home equity loans 100 — 100

Total Personal Banking 669 — 669

Real estate Total

Commercial Banking:

11 unchanged sentences

a term extension, principal forgiveness, an other-than-insignificant payment delay, and/or an interest rate reduction.

The following table presents the amortized cost basis of loans as of December 31, 2023 that were both experiencing financial difficulty and modified during the periods indicated, by class and by type of modification.

The following table presents the amortized cost basis of loans for the periods indicated that were both experiencing financial difficulty and modified during the periods indicated, by class and by type of modification.

The percentage of the amortized cost basis of loans that were modified to borrowers in financial distress as compared to the amortized cost basis of each class of financial receivable is also presented below (dollars in thousands).

3 unchanged sentences

December 31, 2024, 2023 and 2022

Payment delay Term extension Combination term extension and interest rate reduction Total class of financing receivable

For the year ended December 31,

Payment delay Term extension Interest rate reduction Combination term extension and interest rate reduction Total

class of financing receivable Payment delay Term extension Combination term extension and interest rate reduction Total

class of financing receivable

Personal Banking:

Residential mortgage loans $ 191 967 — — 0.04 % $ 363 499 — 0.03 %

$ 363 499 — 0.03 %

Home equity loans — 541 — 142 0.06 % — 403 84 0.04 %

Consumer loans

— — — 12 0.01 % — 3 — %

Total Personal Banking 191 1,508 — 154 0.03 % 363 902 87 0.02 %

1 unchanged sentence

Commercial real estate loans 268 191 — — 0.02 % — 71 — — %

Commercial real estate loans - owner occupied — — 664 — 0.19 % — — %

Commercial loans — 34 — 8 — % — 11 — — %

1 unchanged sentence

Total $ 459 1,733 664 162 0.03 % $ 363 984 87 0.01 %

The Company has committed to lend additional amounts totaling $ 31,000 to the borrowers included in the previous table.

The following table presents the effect of the loan modifications presented above to borrowers experiencing financial difficulty for the year ended December 31, 2023:

Weighted-average interest rate reduction Weighted-average term extension in months Payment deferral (Years)

The following table presents the effect of the loan modifications presented above to borrowers experiencing financial difficulty for the periods indicated :

For the year ended December 31,

Weighted-average interest rate reduction Weighted-average term extension

in months Payment deferral (months) Weighted-average interest rate reduction Weighted-average term extension

in months Payment deferral (months)

Personal Banking:

5 unchanged sentences

Commercial real estate loans — % 117 5 — % 57 0

Commercial real estate loans - owner occupied 2 % 0 0 — % 0 0

Commercial loans 4 % 31 0 — % 23 0

2 unchanged sentences

The Company closely monitors the performance of loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts.

The following table presents the performance of loans that such loans have been modified since the adoption of ASU 2022-02 (in thousands):

The following table presents the performance of loans that such loans have been modified within the previous twelve months of December 31, 2024 (in thousands):

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

Current 30-59 days

1 unchanged sentence

delinquent 90 days or

greater delinquent

Personal Banking:

5 unchanged sentences

Commercial real estate loans 153 — — 268

Commercial real estate loans - owner occupied 664 — — —

Commercial loans 43 — — —

1 unchanged sentence

Total loans $ 1,512 120 9 475

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

A modification is considered to be in default when the loan is 90 days or more past due.

The following table provides the amortized cost basis of financing receivables that had a payment default during the period and were modified since the adoption of ASU 2022-02 to borrowers experiencing financial difficulty (in thousands) :

Payment delay

Personal Banking:

Residential mortgage loans $ 363

Total Personal Banking 363

The modifications to borrowers experiencing financial distress are included in their respective portfolio segment and the current loan balance and updated loan terms are run through their respective ACL models to arrive at the quantitative portion of the ACL.

Subsequent performance of the loans will be measured by delinquency status and will be captured through our ACL models or our qualitative factor assessment, as deemed appropriate.

If we no longer believe the loan demonstrates similar risks to their respective portfolio segment an individual assessment will be performed.

Upon the Company’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or a portion of the loan) is written off.

Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses is adjusted by the same amount.

The following table provides a roll forward of troubled debt restructurings for the period indicated, prior to the adoption of ASU 2022-02 (dollars in thousands):

For the year ended December 31, 2022

contracts Amount

Beginning TDR balance:

New TDRs 14 30,894

Re-modified TDRs 11 8,391

Net paydowns — ( 11,870 )

Residential mortgage loans 2 ( 63 )

Commercial real estate loans 1 ( 150 )

Commercial loans 1 ( 130 )

Paid-off loans:

Residential mortgage loans 4 ( 361 )

Home equity loans 3 ( 89 )

Commercial real estate loans 6 ( 4,324 )

Commercial real estate loans - owner occupied 1 ( 44 )

Commercial loans 7 ( 3,470 )

Ending TDR balance:

Accruing TDRs $ 11,442

Nonaccrual TDRs 29,239

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

The following tables provide information related to TDRs (including re-modified TDRs) by portfolio segment and by class of financing receivable during the periods indicated, prior to the adoption of ASU 2022-02 (dollars in thousands):

For the year ended December 31, 2022

contracts Recorded

at the time of

modification Current

investment Current

The Company closely monitors the performance of loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts.

The following table presents the performance of loans that such loans have been modified since the adoption of ASU 2022-02 (in thousands):

Current 30-59 days

delinquent 60-89 days

delinquent 90 days or

greater delinquent

Personal Banking:

1 unchanged sentence

Home equity loans 465 23 — —

Consumer loans 3 — — —

Total Personal Banking 616 365 8 363

3 unchanged sentences

Total Commercial Banking 82 — — —

Total 25 $ 39,285 21,910 165

Total loans $ 698 365 8 363

A modification is considered to be in default when the loan is 90 days or m ore past due.

The following table provides the amortized cost basis of financing receivables that had a payment default during the periods indicated and were modified within the previous twelve months to borrowers experiencing financial difficulty (in thousands):

For the year ended December 31,

contracts Recorded

at the time of

modification Current

investment Current

Personal Banking:

Residential mortgage loans 1 $ 125 114 15

Home equity loans 3 155 34 34

Total Personal Banking 4 280 148 49

Commercial Banking:

Commercial real estate loans 8 12,006 10,572 1,453

Commercial loans 6 4,147 3,903 451

Total Commercial Banking 14 16,153 14,475 1,904

Total 18 $ 16,433 14,623 1,953

The following table provides information as of December 31, 2022 for TDRs (including re-modified TDRs) by type of modification, by portfolio segment and class of financing receivable for modifications during the year ended December 31, 2022, prior to the adoption of ASU 2022-02 (dollars in thousands):

Type of modification

Number of contracts Rate Payment Maturity date Total

Personal Banking:

Residential mortgage loans 4 $ — 379 143 522

Home equity loans 6 — 23 148 171

Total Personal Banking 10 — 402 291 693

Commercial Banking:

Commercial real estate loans 9 129 98 20,727 20,954

Commercial loans 6 — — 263 263

Total Commercial Banking 15 129 98 20,990 21,217

Total 25 $ 129 500 21,281 21,910

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

The following table provides information as of December 31, 2021 for TDRs (including re-modified TDRs) by type of modification, by portfolio segment and class of financing receivable for modifications during the year ended December 31, 2021, prior to the adoption of ASU 2022-02 (dollars in thousands):

Type of modification

Number of contracts Rate Payment Maturity date Other Total

Personal Banking:

Residential mortgage loans

1 $ 114 — — — 114

Home equity loans

3 — 30 4 — 34

Total Personal Banking 4 114 30 4 — 148

Commercial Banking:

Commercial real estate loans

8 2,077 — 8,424 71 10,572

Commercial loans

6 171 — 3,732 — 3,903

Total Commercial Banking 14 2,248 — 12,156 71 14,475

Total 18 $ 2,362 30 12,160 71 14,623

The following table provides information related to re-modified trouble debt restructurings by portfolio segment and class of financing receivable for modifications during the year ended December 31, 2022, prior to the adoption of ASU 2022-02 (dollars in thousands):

Type of re-modification

re-modified TDRs Payment Maturity date Total

Personal Banking:

Residential mortgage loans

1 $ — 129 129

Home equity loans

Total Personal Banking 2 — 129 129

Commercial Banking:

Commercial real estate loans

Commercial loans

Total Commercial Banking 9 53 406 459

Total 11 $ 53 535 588

The following table provides information related to re-modified trouble debt restructurings by portfolio segment and class of financing receivable for modifications during the year ended December 31, 2021, prior to the adoption of ASU 2022-02 (dollars in thousands):

Type of re-modification

re-modified TDRs Rate Maturity date Other Total

Term extension Combination term extension and interest rate reduction Payment delay

Personal Banking:

Residential mortgage loans $ — 191 363

1 $ 114 — — 114

Home equity loans 16 — —

2 unchanged sentences

Commercial real estate loans — 268 —

7 2,077 5,108 71 7,256

Total Commercial Banking — 268 —

4 unchanged sentences

December 31, 2024, 2023 and 2022

No TDRs modified within the previous twelve months of December 31, 2022 subsequently defaulted.

The following table provides information related to troubled debt restructurings modified within the previous twelve months of December 31, 2021 that subsequently defaulted (prior to the adoption of ASU 2022-02):

contracts Recorded

at the time of

modification Current

investment Current

Commercial Banking:

Commercial real estate loans 1 $ 4,167 3,823 —

Total Commercial Banking 1 4,167 3,823 —

Total 1 $ 4,167 3,823 —

The modifications to borrowers experiencing financial distress are included in their respective portfolio segment and the current loan balance and updated loan terms are run through their respective allowance for credit losses (ACL) models to arrive at the quanti tative portion of the ACL.

Subsequent performance of the loans will be measured by delinquency status and will be captured through our ACL models or our qualitative factor assessment, as deemed appropriate.

If we no longer believe the loan demonstrates similar risks to their respective portfolio segment an individual assessment will be performed.

Upon the Company’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or a portion of the loan) is written off.

Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses is adjusted by the same amount.

The following table provides information related to the amortized cost basis of loan payment delinquencies at December 31, 2024 (in thousands):

71 unchanged sentences

Pass — Loans classified as pass are homogeneous loans that are less than 90 days past due from the required payment date at month-end.

Substandard — Loans classified as substandard are homogeneous loans that are greater than 90 days past due from the required payment date at month-end, loans classified as TDRs, or homogenous retail loans that are greater than 180 days past due from the requirement payment date at month-end that has been written down to the value of underlying collateral, less costs to sell.

Substandard — Loans classified as substandard are homogeneous loans that are greater than 90 days past due from the required payment date at month-end or homogenous retail loans that are greater than 180 days past due from the requirement payment date at month-end that has been written down to the value of underlying collateral, less costs to sell.

Doubtful — Loans classified as doubtful are homogeneous loans that are greater than 180 days past due from the required payment date at month-end and not written down to the value of underlying collateral.

28 unchanged sentences

Total Personal Banking 706,561 721,774 1,166,567 1,066,875 656,604 1,414,621 542,726 47,022 6,322,750

Business Banking:

Commercial Banking:

Commercial real estate loans

20 unchanged sentences

charge-offs ( 1,456 ) ( 6,752 ) ( 4,301 ) ( 235 ) ( 522 ) ( 916 ) ( 212 ) ( 68 ) ( 14,462 )

Total Business Banking 737,133 985,417 481,978 401,325 353,816 1,069,877 569,104 34,089 4,632,739

Total Commercial Banking 980,497 666,430 771,944 404,253 348,286 1,112,321 542,032 31,501 4,857,264

Total loans $ 1,687,058 1,388,204 1,938,511 1,471,128 1,004,890 2,526,942 1,084,758 78,523 11,180,014

11 unchanged sentences

Total residential mortgage loans 177,313 666,960 792,488 507,320 244,989 1,030,347 — — 3,419,417

Residential mortgage current period charge-offs — ( 9 ) ( 5 ) ( 130 ) ( 23 ) ( 1,022 ) — — ( 1,189 )

Home equity loans

2 unchanged sentences

Total home equity loans 71,497 100,875 106,097 146,318 94,179 198,992 465,315 44,585 1,227,858

Home equity current period charge-offs — ( 53 ) ( 46 ) — ( 48 ) ( 352 ) ( 144 ) ( 209 ) ( 852 )

Vehicle loans

2 unchanged sentences

Total vehicle loans 665,522 683,693 399,262 133,074 68,409 58,641 — — 2,008,601

Vehicle current period charge-offs ( 678 ) ( 1,844 ) ( 1,967 ) ( 475 ) ( 652 ) ( 852 ) — — ( 6,468 )

Consumer loans

2 unchanged sentences

Total consumer loans 24,332 11,625 5,571 2,078 1,361 6,649 64,940 870 117,426

Consumer loan current period charge-offs ( 3,412 ) ( 511 ) ( 390 ) ( 157 ) ( 177 ) ( 981 ) ( 317 ) ( 38 ) ( 5,983 )

Total Personal Banking 938,664 1,463,153 1,303,418 788,790 408,938 1,294,629 530,255 45,455 6,773,302

Business Banking:

Commercial Banking:

Commercial real estate loans

3 unchanged sentences

Total commercial real estate loans 228,074 496,247 358,594 356,152 269,479 866,626 28,373 24,912 2,628,457

Commercial real estate current period charge-offs ( 14 ) — ( 492 ) — ( 51 ) ( 1,741 ) — — ( 2,298 )

Commercial real estate loans - owner occupied

3 unchanged sentences

Total commercial real estate loans - owner occupied 25,946 52,106 48,991 17,650 47,646 147,768 2,378 3,068 345,553

Commercial real estate - owner occupied current period charge-offs — — — — — ( 68 ) — — ( 68 )

Commercial loans

3 unchanged sentences

Total commercial loans 483,113 437,064 74,393 27,523 36,691 55,483 538,353 6,109 1,658,729

Total Business Banking 869,339 512,918 462,521 398,606 319,410 970,375 397,904 24,451 3,955,524

Commercial loans current period

charge-offs ( 35 ) ( 2,072 ) ( 517 ) ( 430 ) ( 205 ) ( 845 ) ( 60 ) ( 2 ) ( 4,166 )

Total Commercial Banking 737,133 985,417 481,978 401,325 353,816 1,069,877 569,104 34,089 4,632,739

Total loans $ 1,675,797 2,448,570 1,785,396 1,190,115 762,754 2,364,506 1,099,359 79,544 11,406,041

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We use the same credit policies in making commitments for off- balance-sheet financial instruments as we do for on-balance-sheet instruments.

Financial instruments with off-balance-sheet risk as of December 31, 2023 and 2022 are presented in the following table:

Financial instruments with off-balance-sheet risk as of December 31, 2024 and 2023 are presented in the following table (in thousands):

Years ended December 31,

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As of December 31, 2024, the maximum potential amount of future payments we could be required to make under these standby letters of credit is $ 58 million, of which $ 42 million is fully collateralized.

A liability (which represents deferred income) of $ 1.1 million and $ 792,000 has been recognized for the obligations as of December 31, 2023 and 2022, respectively, and there are no recourse provisions that would enable us to recover any amounts from third parties.

A liability (which represents deferred income) of $ 1 million and $ 1 million has been recognized for the obligations as of December 31, 2024 and 2023, respectively, and there are no recourse provisions that would enable us to recover any amounts from third parties.

In addition, we maintain a $ 20 million credit limit with a correspondent bank for private label credit card facilities for certain existing commercial clients of the Bank, of which $ 11 million of the credit limit was allocated to credit cards that have been issued.

These issued credit cards had an outstanding balance of $ 632,000 at December 31, 2023.

These issued credit cards had an outstanding balance of $ 2 million at December 31, 2024.

The clients of the Bank are responsible for repaying any balances due on these credit cards directly to the correspondent bank;

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Additions 788 ( 1 ) 787

MSR sale ( 5,930 ) — ( 5,930 )

Amortization ( 1,551 ) — ( 1,551 )

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Additions 558 6 564

MSR sale ( 5,930 ) — ( 5,930 )

Amortization ( 433 ) — ( 433 )

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Northwest Bank is a member of the FHLB of Pittsburgh and a former member of the FHLB of Indianapolis.

As a member of the FHLB of Pittsburgh, we are required to maintain an investment in the capital stock of the FHLB of Pittsburgh in accordance with their 2015 Capital Plan, at cost, in two subclasses based on the following ranges:

Membership stock purchase (Subclass B-1) ranging from 0.05 % to 1.0 % of the member asset value as defined by the FHLB, currently at 0.10 %;

and Activity-based stock purchase (Subclass B-2) ranging from 2.0 % to 6.0 % of outstanding advances, currently at 4.0 %;

0.0 % to 6.0 % of acquired member assets, currently at 4.0 %;

0.0 % to 4.0 % of certain letters of credit, currently at 0.75 %;

and 0.0 % to 6.0 % of outstanding advance commitments settling more than 30 days after trade, currently at 0.0 %.

As a former member of the FHLB of Indianapolis, we are required to maintain an investment in the capital stock of the FHLB of Indianapolis in accordance with their capital plan that became effective on September 26, 2020.

This plan requires the Company, as a former member, to maintain its activity-based stock requirements (B-2 stock) ranging from 1.0 % to 6.0 % of advances, currently at 4.5 %;

1.0 % to 6.0 % for lines of credit, currently at 4.5 %;

0.10 % to 6.0 % for letters of credit, currently at 0.10 %;

1.0 % to 6.0 % of derivative contracts, currently at 4.5 %;

0.0 % to 6.0 % for mandatory Mortgage Purchase Program (when servicing rights are created through loan originations and the underlying loan is sold).

Upon sale, the mortgage servicing right (“MPP”), currently at 0.0 %, 0.0 % to 6.0 % for optional MPP, currently at 4.5 %;

and 1.0 % to 6.0 % for Community Investment Program (when servicing rights are created through loan originations and the underlying loan is sold).

Upon sale, the mortgage servicing right (“CIP”) advances, currently at 4.5 %.

Class B stock may be redeemed upon five year’s prior written notice from the member in accordance with Section VI.B of the capital plan.

Class B stock is also subject to repurchase by the FHLB of Indianapolis, in its discretion, whether or not requested by the member.

Our class B shares are scheduled to be redeemed on April 24, 2025 unless they are repurchased by the FHLB of Indianapolis prior to that date.

As a member of the FHLB of Pittsburgh, we are required to maintain a minimum investment in capital stock of the FHLB of Pittsburgh based upon membership, level of borrowings, collateral balances or participation in other programs.

As a former member of the FHLB of Indianapolis, we are required to maintain a minimum investment in the capital stock of the FHLB of Indianapolis based upon participation in certain past programs.

Our investment in the capital stock of the FHLB of Pittsburgh at December 31, 2024 and December 31, 2023 was $ 18 million and $ 27 million, respectively.

In addition, our investment of capital stock of the FHLB of Indianapolis at December 31, 2023 and December 31, 2022 was $ 3.1 million.

We received dividends on capital stock during the years ended December 31, 2023 and 2022 of $ 2.9 million and $ 730,000 , respectively.

Future dividends may be established at different rates for the two subclasses of capital stock.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

In addition, our investment in the capital stock of the FHLB of Indianapolis at December 31, 2024 and December 31, 2023 was $ 3 million.

We received dividends on capital stock during the years ended December 31, 2024 and 2023 of $ 2 million and $ 3 million, respectively.

(8) Premises and Equipment

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Depreciation and amortization expense for the years ended December 31, 2024, 2023, and 2022 was $ 11 million, $ 12 million, and $ 12 million, respectively.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

(9) Goodwill and Other Intangible Assets

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Core deposit intangibles - net $ 2,837 5,290

Customer and Contract intangible assets - gross $ 12,775 12,775

accumulated amortization ( 12,775 ) ( 12,747 )

Customer and Contract intangible assets - net — 28

Total intangible assets - net $ 2,837 5,290

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For the year ending December 31, 2027 304

For the year ending December 31, 2027 305

The following table provides information for the changes in the carrying amount of goodwill:

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As of December 31, 2024, 2023 and 2022, there were no events or changes in circumstances that would cause us to update that year ’ s goodwill impairment test and we concluded there was no impairment of goodwill as of such dates.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

(10) Deposits

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Total deposits $ 12,144,554 11,979,902

(1) Includes $ 483.9 million and $ 0 of brokered deposits at December 31, 2023 and 2022.

The aggregate amount of time deposits with a minimum denomination of $100,000 at December 31, 2023 and 2022 was $ 950.3 million and $ 355.0 million, respectively.

(1) Includes $ 201 million and $ 484 million of brokered deposits at December 31, 2024 and 2023.

The aggregate amount of time deposits with a minimum denomination of $100,000 at December 31, 2024 and 2023 was $ 1.1 billion and $ 950 million, respectively.

Generally, deposits in excess of $250,000 are not federally insured.

At December 31, 2024 and 2023, we had $ 1.9 billion and $ 1.8 billion of deposits in accounts exceeding $250,000, respectively.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

The following table summarizes the contractual maturity of time deposits at December 31, 2024 and 2023:

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Total interest expense on deposits $ 205,492 105,343 14,120

(1) Includes $ 7.8 million, $ 0 , and $ 0 of interest expense on brokered deposits at December 31, 2023, 2022, and 2021.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

(1) Includes $ 18 million, $ 8 million, and $ 0 of interest expense on brokered deposits at December 31, 2024, 2023, and 2022.

(11) Borrowed Funds

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Borrowed funds at December 31, 2024 and 2023 are presented in the following table:

At December 31,

Amount Average rate Amount Average rate

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This represents collateral posted to us from our derivative counterparties.

At December 31, 2023 and December 31, 2022, term notes payable to the FHLB of Pittsburgh due within one year were $ 175.0 million and $ 500.0 million, respectively.

The December 31, 2023 total is made up of seven advances:

$ 25.0 million at 5.76 % maturing January 26, 2024;

$ 25.0 million at 5.77 % maturing January 31, 2024;

$ 25.0 million at 5.73 % maturing February 9, 2024;

$ 25.0 million at 5.68 % maturing February 13, 2024;

$ 25.0 million at 5.70 % maturing February 12, 2024;

$ 25.0 million at 5.67 % maturing February 20, 2024 and $ 25.0 million at 5.67 % maturing February 29, 2024.

At December 31, 2024 and December 31, 2023, term notes payable to the FHLB of Pittsburgh due within one year were $ 175 million.

The December 31, 2024 total is made up of seven advance each for $ 25 million.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

On September 9, 2020, the Company issued $ 125 million of 4.00 % fixed-to-floating rate subordinated notes with a maturity date of September 15, 2030.

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At December 31, 2024 and December 31, 2023, subordinated debentures, net of issuance costs, were $ 115 million and $ 114 million, respectively.

For the years ended December 31, 2023, December 31, 2022, and December 31, 2021 total interest expense paid on the subordinate notes was $ 4.9 million, $ 5.1 million, and $ 5.3 million, respectively.

For each of the years ended December 31, 2024, December 31, 2023, and December 31, 2022, total interest expense paid on the subordinate notes was $ 5 million.

(b) Trust Preferred Securities

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The Trusts exist solely to issue preferred securities to third parties for cash, issue common securities to the Company in exchange for capitalization of the Trusts, invest the proceeds from the sale of trust securities in an equivalent amount of debentures of the Company, and engage in other activities that are incidental to those previously listed.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

The Trusts have invested the proceeds of the offerings in junior subordinated deferrable interest debentures issued by the Company.

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• the preferred securities do not qualify as Tier I capital.

We may, at any time, dissolve any of the Trusts and distribute the debentures to the trust security holders, subject to receipt of any required regulatory approvals.

NORTHWEST BANCSHARES, INC.

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December 31, 2024, 2023 and 2022

We may, at any time, dissolve any of the Trusts and distribute the debentures to the trust security holders, subject to receipt of any required regulatory approvals.

(12) Income Taxes

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Stock benefit plans 1,950 1,134

Pension and post-retirement benefits — 2,767

Unrealized loss on the fair value of securities available-for-sale 39,473 45,985

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This is netted against the net operating loss deferred tax asset in the preceding table.

We recorded a valuation allowance against state deferred tax assets of a Northwest subsidiary since the subsidiary is not expected to utilize its deferred tax assets in the foreseeable future.

This valuation allowance is netted against other deferred tax assets in the preceding table.

The holding company has net operating loss carryforwards with the state of Pennsylvania of $ 102 million as of December 31, 2024 and $ 85 million as of December 31, 2023.

The company has recorded a full valuation allowance against these carryforward attributes of Northwest Bancshares Inc.

as it is not expected to realize these losses given the profitability of Northwest Bancshares for Pennsylvania tax purposes.

The valuation allowance is netted against the net operating loss in the preceding table.

We recorded $ 0.2 million a valuation allowance against state deferred tax assets of a Northwest subsidiary since the subsidiary is not expected to utilize its deferred tax assets in the foreseeable future.

This valuation allowance is netted against the net operating loss in the preceding table.

Other than stated above, we have determined that no valuation allowance is necessary for the deferred tax assets because it is more likely than not that these assets will be realized through future reversals of existing temporary differences and through future taxable income.

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Bad debt deductions for income tax purposes are included in taxable income of later years only if the bad debt reserve is used subsequently for purposes other than to absorb bad debt losses.

Because Northwest does not intend to use the reserve for purposes other than to absorb losses, no deferred income taxes have been provided prior to fiscal 1987.

There was no required recapture of the pre-1988 reserves.

The pre-1988 reserves would only be subject to recapture and income if there is a distribution in excess of earnings and profits or liquidation.

Retained earnings at December 31, 2024 and 2023 include approximately $ 39 million representing such bad debt deductions for which no deferred income taxes have been provided.

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Basic earnings per common share (“EPS”) is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding for the period, without considering any dilutive items.

Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company.

During the year ended December 31, 2023, 2,814,207 stock options were not included in the computation of diluted earnings per share because the stock options’ exercise price was more than the average market price of the common shares of $ 11.75 .

During the year ended December 31, 2022, 1,950,847 stock options were not included in the computation of diluted earnings per share because the stock options’ exercise price was more than the average market price of the common shares of $ 13.79 .

During the year ended December 31, 2021, 2,146,897 stock options were not included in the computation of diluted earnings per share because the stock options’ exercise price was more than the average market price of the common shares of $ 13.80 .

Diluted EPS is calculated using both the two-class and the treasury stock methods with the more dilutive method used to determine diluted EPS.

The two-class method was used to determine basic EPS and the treasury stock method was used to determine diluted earnings per share for the year ended December 31, 2024.

The two-class method was used to determine basic and diluted EPS for the years ended December 31, 2023 and 2022 .

The following table sets forth the computation of basic and diluted earnings per share for the years ended December 31, 2024, 2023 and 2022.

NORTHWEST BANCSHARES, INC.

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December 31, 2024, 2023 and 2022

The following table sets forth the computation of basic and diluted earnings per share for the years ended December 31, 2023, 2022 and 2021.

Years ended December 31,

2024 2023 2022

Net income $ 134,957 133,666 154,323

Numerator for earnings per share - Basic and Diluted:

Net income - treasury stock method - Basic and Diluted $ 100,278 134,957 133,666

Dividends and undistributed earnings allocated to participating securities 125 339 585

Net income available to common shareholders $ 134,618 133,081 153,313

Weighted average common shares outstanding (1) 126,668,671 126,167,892 126,181,586

Participating shares outstanding (1) 319,501 556,201 828,251

Total weighted average common shares and dilutive potential shares (1) 126,988,172 126,724,093 127,009,837

Net income available to common shareholders - two class method - Basic and Diluted $ 100,153 134,618 133,081

Denominator for earnings per share - treasury stock method - Basic and Diluted

Weighted average common shares outstanding - Basic 127,085,446 126,668,671 126,167,892

Potentially dilutive shares 614,055 421,670 274,509

Denominator for treasury stock method - Diluted 127,699,501 127,090,341 126,442,401

Denominator for earnings per share - two class method - Basic and Diluted:

Weighted average common shares outstanding - Basic 127,085,446 126,668,671 126,167,892

Average participating shares outstanding 158,719 319,501 556,201

Denominator for two class method - Diluted 127,244,165 126,988,172 126,724,093

Basic earnings per share $ 0.79 1.06 1.05

Diluted earnings per share $ 0.79 1.06 1.05

(1) Not in thousands.

Anti-dilutive awards (1) 2,128 2,814 1,951

(1) Reflects the total number of shares related to outstanding options that have been excluded from the computation of diluted earnings per share because the impact would have been anti-dilutive.

(15) Employee Benefit Plans

(a) Pension Plans

We maintain noncontributory defined benefit pension plans covering substantially all employees and members of our board of directors.

We maintain noncontributory defined benefit pension plans covering certain employees and members of our board of directors.

Retirement benefits are based on certain compensation levels, age, and length of service.

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Employees that are hired, rehired, acquired, or transfer to an eligible job classification on or after August 1, 2020 are not eligible to participate in the Pension Plan.

Total expense for the defined contribution retirement savings plan was $ 4.4 million, $ 3.6 million, and $ 4.6 million for the years ended December 31, 2023, 2022 and 2021, and net periodic pension expense for the defined benefit pension plan was a benefit of $ 1.1 million for the year ended December 31, 2023 and a total cost of $ 893,000 and $ 5.5 million for the years ended 2022 and 2021, respectively.

Total expense for the defined contribution retirement savings plan was $ 2 million, $ 4 million, and $ 4 million for the years ended December 31, 2024, 2023 and 2022, and net periodic pension expense for the defined benefit pension plan was a benefit of $ 3 million and $ 1 million for the years ended December 31, 2024 and 2023, respectively and a total cost of and $ 0.9 million for the year ended 2022.

NORTHWEST BANCSHARES, INC.

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Total recognized in net periodic pension cost and other comprehensive income $ ( 25,627 ) ( 12,950 ) ( 25,072 )

The estimated net gain and prior service credit for the defined benefit pension plan that will be amortized from accumulated other comprehensive income into net periodic cost ending December 31, 2024 is $ 71,000 and $ 2.3 million, respectively.

The following table sets forth information for the defined benefit pension plans’ funded status at December 31, 2024 and 2023:

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Assets are invested in a balanced portfolio composed primarily of equities, fixed income, and cash or cash equivalent investments.

The Trustee tries to maintain an approximate asset mix position of 20 % to 50 % bonds and 30 % to 60 % equities.

The Trustee tries to maintain an approximate asset mix po sition of 50 % to 80 % bonds and 20 % to 35 % equities.

A maximum of 10 % may be invested in any one stock, including the stock of Northwest Bancshares, Inc.

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Target allocation 2024 2023

Debt securities 20 – 50 %

Equity securities 20 – 35 %

Debt securities 50 – 80 %

Other 0 – 10 %

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The expected benefits to be paid are based on the same assumptions used to measure our benefit obligations at December 31, 2024 and include estimated future employee service.

(b) Post-retirement Healthcare Plan

In addition to pension benefits, we provide post-retirement healthcare benefits for certain employees who were employed as of October 1, 1993 and were at least 55 years of age on that date.

We use the accrual method of accounting for post-retirement benefits other than pensions.

Components of net periodic benefit cost and other amounts recognized in other comprehensive income:

The following table sets forth the net periodic benefit cost for the post-retirement healthcare benefits plan for the years ended December 31, 2023, 2022 and 2021:

Years ended December 31,

2023 2022 2021

Interest cost $ 71 40 42

Amortization of net loss 39 6 14

Net period benefit cost $ 110 46 56

The following table sets forth other changes in the post-retirement healthcare plan’s plan assets and benefit obligations recognized in other comprehensive income:

Years ended December 31,

2023 2022 2021

Net (gain)/loss $ ( 35 ) 183 ( 66 )

Total recognized in other comprehensive income $ ( 35 ) 183 ( 66 )

Total recognized in net periodic benefit cost and other comprehensive income $ 74 229 ( 10 )

The estimated net loss for the post-retirement healthcare benefit plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the year ending December 31, 2024 is $ 38,000 .

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

The following table sets forth the funded status of the post-retirement healthcare benefit plan at December 31, 2023 and 2022:

Change in benefit obligation:

Benefit obligation at beginning of year $ 1,521 1,560

Interest cost 71 40

Actuarial loss 3 189

Benefits paid ( 209 ) ( 268 )

Benefit obligation at end of year $ 1,386 1,521

Change in plan assets:

Employer contributions $ 209 268

Benefits paid ( 209 ) ( 268 )

Funded status at year end $ ( 1,386 ) ( 1,521 )

The assumptions used to develop the preceding information for post-retirement healthcare benefits are as follows:

Years ended December 31,

2023 2022 2021

Discount rate 4.99 % 2.75 % 2.39 %

Monthly cost of healthcare insurance per beneficiary (1) $ 916 415 343

Annual rate of increase in healthcare costs 5.00 % 5.00 % 5.00 %

(1) Not in thousands.

If the assumed rate of increase in healthcare costs was increased by one percentage point to 6 % from the level presented above, the interest cost component of net periodic post-retirement healthcare benefit cost would increase by $ 3,300 and the accumulated post-retirement benefit obligation for healthcare benefits would increase by $ 66,200 .

The following table sets forth information for plans with an accumulated benefit obligation in excess of plan assets:

Projected benefit obligation $ 1,386 1,521

Accumulated benefit obligation 1,386 1,521

On April 18, 2018, shareholders approved the Northwest Bancshares, Inc.

2018 Equity Incentive Plan with 1,500,000 common shares authorized for award.

From this plan, we awarded employees 293,755 common shares and outside directors 27,000 common shares with a grant date fair value of $ 13.68 per share (total market value of $ 4.4 million at issuance) on May 25, 2021.

Also during 2021, we awarded discretionary grants of 13,452 common shares with a weighted average grant date fair value of $ 13.76 .

During 2022, we awarded discretionary grants of 12,521 common shares with a weighted average grant date fair value of $ 13.98 .

These shares vest over a five or seven years period, depending on the date of grant, with the first vesting occurring on the date of grant.

Total common shares forfeited from the 2018 plan were 265,176 , of which 40,362 shares were forfeited during the year ended December 31, 2023.

Forfeited shares may be awarded to other eligible recipients in future grants until the plan termination date in 2028.

At December 31, 2023, there was compensation expense of $ 2.1 million to be recognized for unvested restricted common shares, with an expense recognition period remaining of three years .

(b) Stock-based Compensation

Stock-based awards are eligible for issuance under the our Incentive Compensation Plans to executives, directors and key employees of the Northwest Bancshares and its subsidiaries.

On May 18, 2022, shareholders approved the Northwest Bancshares, Inc.

2022 Equity Incentive Plan with 3,500,000 shares authorized for award.

From this plan we can awarded employees or directors restricted stock units (“RSUs”).

The RSUs vest over a specified time period with the first vesting occurring one year from the grant date.

We also award restricted stock awards (“RSAs”) which fully vest one-year from the grant date.

We also award performance share units (“PSUs”).

The number of PSUs earned will be based on attainment of certain performance criteria over a three-year period, with the actual number of shares issuable ranging between 0 % and 150 % of the number of PSUs granted.

The PSUs have a three-year cliff vesting, from the date of grant, and any PSU’s earned will be issued after the vesting period.

2022 Equity Incentive Plan with up to 3,500,000 shares authorized for award.

This plan provides for the granting of stock options, restricted stock awards ( “ RSAs ” ), restricted stock units ( “ RSUs ” ) and performance awards.

At December 31,2024 1,079,102 shares were available for future grants.

We issue shares to fulfill stock-based award vesting from available authorized common shares.

At December 31,2024, we believe there are adequate authorized common shares to satisfy anticipated stock-based vesting for all grants outstanding.

Stock-based compensation expense was $ 6 million, $ 4 million and $ 3 million and was included in compensation and employee benefits expense on the Consolidated Statements of Income during the years ended December 31, 2024, 2023 and 2022, respectively.

The effect on net income for the years ended December 31, 2024, 2023 and 2022 was a reduction of $ 4 million, $ 3 million and $ 2 million, respectively.

Restricted Stock Awards, Restricted Stock Units and Performance Share Units

Restricted stock awards, Restricted Stock Units and Performance Share Units (“PSUs ” ) are all issued subject to service restrictions.

PSUs are payable contingent on the achievement of certain predefined performance objectives over a three-year measurement period w ith the actual number of shares issuable ranging between 0 % and 150 % of the number of PSUs granted.

RSAs accumulate dividends that are paid upon vesting.

NORTHWEST BANCSHARES, INC.

2 unchanged sentences

December 31, 2024, 2023 and 2022

During the years ended December 31, 2022 and 2023, we granted the following awards (amounts in this table are not in thousands) :

During the years ended December 31, 2022, December 31, 2023 and December 31, 2024, we granted the following awards (amounts in this table are not in thousands) :

Year-ended Grant date Award to Shares Grant type Weighted average grant date fair value Total

market value Vesting period

market value ($) Vesting period (years)

December 31, 2022

5/18/2022 Employees 150,027 RSU $ 11.00 $ 1.7 million 3 years

5/18/2022 Employees 150,027 PSU 10.26 $ 1.5 million 3 years

5/18/2022 Directors 41,206 RSA 12.55 $ 517,000 1 year

Various Employees 13,115 RSU 12.69 $ 166,000 3 years

5/18/2022 Employees 150,027 RSU $ 11.00 1.7 million 3

5/18/2022 Employees 150,027 PSU 10.26 1.5 million 3

5/18/2022 Directors 41,206 RSA 12.55 517,000 1

Various Employees 13,115 RSU 12.69 166,000 3

December 31, 2023

3/15/2023 Employees 176,623 RSU 11.28 $ 2.0 million 3 years

3/15/2023 Employees 176,623 PSU 10.54 $ 1.9 million 3 years

3/15/2023 Directors 33,048 RSA 12.80 $ 423,000 1 year

3/27/2023 Employees 80,980 RSU 11.20 $ 907,000 2 years

Various Employees 128148 RSU 10.30 $ 1.3 million 3 years

3/15/2023 Employees 176,623 RSU 11.28 2.0 million 3

3/15/2023 Employees 176,623 PSU 10.54 1.9 million 3

3/15/2023 Directors 33,048 RSA 12.80 423,000 1

3/27/2023 Employees 80,980 RSU 11.20 907,000 2

Various Employees 128,148 RSU 10.30 1.3 million 3

December 31, 2024

3/20/2024 Employees 307,775 RSU 9.79 3.0 million 3

3/20/2024 Employees 324,124 PSU 9.07 2.9 million 3

3/20/2024 Directors 41,560 RSA 11.31 470,000 1

Various Employees 266,106 RSU 10.86 2.9 million 3 to 4

Total shares forfeited from the 2022 plan were 210,214 of which 139,141 shares were forfeited during the year ended December 31, 2024.

1 unchanged sentence

At December 31, 2024, there was compensation expense of $ 918,215 to be recognized for awarded but unvested RSAs, with an expense recognition period remaining of one year .

(d) Stock Option Plans

The Northwest Bancshares, Inc.

2018 Equity Incentive Plan also authorized the granting of 3,500,000 stock options authorized for award.

On May 25, 2021, we granted employees 621,972 stock options and outside directors 72,000 stock options with an exercise price of $ 13.68 per share.

There were no stock options granted during the years-ended December 31, 2022 and December 31, 2023.

These awarded stock options vest over a five-year period with the first vesting occurring on the grant date with a ten-year exercise period from the grant date.

The following table summarizes the activity in our option plans during the years ended December 31, 2023, 2022 and 2021 (amounts in this table are not in thousands):

There were no stock options granted during the years ended December 31, 2024, December 31, 2023 or December 31, 2022.

Previously granted options were valued using the Black-Scholes option pricing model.

The following table summarizes the activity in our option plans during the years ended December 31, 2024, December 31, 2023 and December 31, 2022 (amounts in this table are not in thousands):

Years ended December 31,

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Balance at beginning of year 3,209,005 $ 14.36 3,657,580 $ 14.25 4,380,310 $ 14.05

Granted (1) — — — — 693,972 13.68

Exercised (1) ( 199,058 ) 12.29 ( 63,315 ) 11.46 ( 465,920 ) 12.14

2 unchanged sentences

Exercisable at end of year 2,355,318 16.17 2,601,367 14.52 2,556,235 14.43

(1) Weighted average fair value of options at grant date:

N/A, N/A and $ 0.64 , respectively.

(2) The total intrinsic value of options exercised was $ 115,000 , $ 839,000 and $ 2.3 million, respectively.

(1) The total intrinsic value of options exercised was $ 390,000 , $ 115,000 and $ 839,000 , respectively.

NORTHWEST BANCSHARES, INC.

4 unchanged sentences

The following table summarizes the number of options outstanding, number of options exercisable, and weighted average remaining life of all option grants as of December 31, 2024 (amounts in this table are not in thousands):

Exercise price

Exercise price Exercise price Exercise price Exercise price

$ 9.71 $ 12.37 $ 13.68 $ 14.15

Options outstanding:

4 unchanged sentences

Weighted average remaining term - vested (years) 4.6 9.6 3.6 8.6

Exercise price

Total average

Exercise price Exercise price Exercise price Exercise price

$ 15.57 $ 16.59 $ 17.27 $ 14.25

Options outstanding:

29 unchanged sentences

The carrying amounts reported in the Consolidated Statement of Financial Condition approximate fair value for the following financial instruments:

cash and cash equivalents, marketable securities available-for-sale, residential mortgage loans held-for-sale, accrued interest receivable, interest rate lock commitments, forward commitments, interest rate swaps, savings and checking deposits, foreign exchange swaps, risk participation agreements, and accrued interest payable.

cash and cash equivalents, marketable securities available-for-sale, loans held-for-sale, accrued interest receivable, interest rate lock commitments, forward commitments, interest rate swaps, savings and checking deposits, foreign exchange swaps, risk participation agreements, and accrued interest payable.

Marketable Securities

4 unchanged sentences

government obligations.

Certain debt securities which were AAA rated at purchase do not have an active market, and as such we have used an alternative method to determine the fair value of these securities.

The fair value has been determined using a discounted cash flow model using market assumptions, which generally include cash flow, collateral and other market assumptions.

As such, securities which otherwise would have been classified as Level 2 securities if an active market for those assets or similar assets existed are included herein as Level 3 assets.

Debt Securities — held-to-maturity - The fair value of debt securities held-to-maturity is determined in the same manner as debt securities available-for-sale.

7 unchanged sentences

The estimated fair value of loans held-for-sale is based on market bids obtained from potential buyers.

Due to the restrictions placed on the transferability of FHLB stock, it is not practical to determine the fair value.

Due to the restrictions placed on transferability of FHLB stock, it is not practical to determine the fair value.

FHLB stock is recorded at cost.

5 unchanged sentences

The valuation adjustment for the portfolio consists of the present value of the difference of these two cash flows, discounted at the assumed market rate of the corresponding maturity.

Borrowed Funds

Fixed rate advances are valued by comparing their contractual cost to the prevailing market cost.

The carrying amount of repurchase agreements approximates their fair value.

NORTHWEST BANCSHARES, INC.

2 unchanged sentences

December 31, 2024, 2023 and 2022

Borrowed Funds

Fixed rate advances are valued by comparing their contractual cost to the prevailing market cost.

The carrying amount of repurchase agreements approximates their fair value.

Subordinated Debentures

14 unchanged sentences

The fair value of the foreign exchange swap is derived from proprietary models rather than actual market quotations.

The proprietary models are based upon financial principles and assumptions we believe to be reasonable.

The proprietary models are based upon financial principles and assumptions that we believe to be reasonable.

Risk participation agreements are entered into when Northwest purchases a portion of a commercial loan that has an interest rate swap.

12 unchanged sentences

December 31, 2024

Carrying amount Estimated fair value Level 1 Level 2 Level 3

Carrying amount Estimated fair value Level 1 Level 2 Level 3 Netting Adjustments (1)

Financial assets:

3 unchanged sentences

Loans receivable, net 11,063,195 10,431,355 — — 10,431,355 —

Residential mortgage loans held-for-sale 8,768 8,768 — — 8,768

Loans held-for-sale 76,331 76,331 — 68,620 7,711 —

Accrued interest receivable 46,356 46,356 46,356 — — —

1 unchanged sentence

Forward commitments 34 34 — 34 — —

Foreign exchange swaps 199 199 — 199 — —

Interest rate swaps designated as hedging instruments 1,497 1,497 — 1,529 — ( 32 )

14 unchanged sentences

Total financial liabilities $ 12,631,617 12,626,720 9,701,963 153,801 2,805,192 ( 34,236 )

(1) Amounts represent the impact of legally enforceable master netting agreements that allow the Company to settle positive and negative positions and cash collateral held or placed with the same counterparties.

NORTHWEST BANCSHARES, INC.

9 unchanged sentences

Loans receivable, net 11,280,798 10,274,593 — — 10,274,593

Residential mortgage loans held-for-sale 9,913 9,913 — — 9,913

Loans held-for-sale 8,768 8,768 — — 8,768

Accrued interest receivable 47,353 47,353 47,353 — —

1 unchanged sentence

Forward commitments 12 12 — 12 —

Interest rate swaps designated as hedging instruments 713 713 — 713 —

Interest rate swaps not designated as hedging instruments 41,406 41,406 — 41,406 —

8 unchanged sentences

Foreign exchange swaps 291 291 — 291 —

Interest rate swaps designated as hedging instruments 1,198 1,198 — 1,198 —

Interest rate swaps not designated as hedging instruments 41,437 41,437 — 41,437 —

9 unchanged sentences

The following table represents assets and liabilities measured at fair value on a recurring basis as of December 31, 2024:

Level 1 Level 2 Level 3 Total at

Level 1 Level 2 Level 3 Netting Adjustments (1) Total at

Debt securities:

16 unchanged sentences

Forward commitments — 34 — — 34

Foreign exchange swaps — 199 — — 199

Interest rate swaps designated as hedging instruments — 1,529 — ( 32 ) 1,497

6 unchanged sentences

Total liabilities $ — 37,819 — ( 2,362 ) 35,425

NORTHWEST BANCSHARES, INC.

22 unchanged sentences

Forward commitments — 12 — 12

Interest rate swaps designated as hedging instruments — 713 — 713

Interest rate swaps not designated as hedging instruments — 41,406 — 41,406

1 unchanged sentence

Foreign exchange swaps $ — 291 — 291

Interest rate swaps designated as hedging instruments — 1,198 — 1,198

Interest rate swaps not designated as hedging instruments — 41,437 — 41,437

5 unchanged sentences

Net activity ( 299 ) 82

Transfers from Level 3 — —

Transfers into of Level 3 — —

Ending balance December 31, $ 342 641

Certain assets and liabilities are measured at fair value on a nonrecurring basis after initial recognition such as loans individually assessed, real estate owned, and MSRs.

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

The following table represents the fair market measurement for only those nonrecurring assets that had a fair market value below the carrying amount as of December 31, 2024:

5 unchanged sentences

Total assets $ — — 9,856 9,856

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023, 2022 and 2021

The following table represents the fair market measurement for only those nonrecurring assets that had a fair market value below the carrying amount as of December 31, 2023:

30 unchanged sentences

Loans held for sale 7,711 Quoted prices for similar loans in active markets adjusted by an expected pull-through rate Estimated pull-through rate 100 %

(1) Fair value is generally determined through independent appraisals of the underlying collateral, which may include Level 3 inputs that are not identifiable.

(17) Regulatory Capital Requirements

We and our banking subsidiary are subject to various regulatory capital requirements administered by the federal and state banking agencies.

Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary actions by the regulators that, if undertaken, could have a direct material effect on our financial statements.

Under capital adequacy guidelines and the regulatory framework for prompt corrective action, specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices must be met.

The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors.

(1) Fair value is generally determined through independent appraisals of the underlying collateral, which may include Level 3 inputs that are not identifiable, or by using the discounted cash flow method if the loan is not collateral dependent.

NORTHWEST BANCSHARES, INC.

2 unchanged sentences

December 31, 2024, 2023 and 2022

Applicable regulations limit an organization’s capital distributions and certain discretionary bonus payments if the organization does not hold a “capital conservation buffer” consisting of 2.5 % of Total Tier 1 and Common Equity Tier 1 (“CET1”) capital to risk-weighted assets in addition to the amount necessary to meet its minimum risk-based capital requirements.

Quantitative measures established by regulation to ensure capital adequacy require us and our banking subsidiary to maintain minimum amounts and ratios (set forth in the table below) of Total, Tier 1, and CET1 capital (as defined in the regulations) to risk-weighted assets (as defined) and of Tier I capital to average assets (as defined).

As of December 31, 2023 and 2022, we and our banking subsidiary exceeded all capital adequacy requirements to which we were subject.

We have elected to phase the estimated impact of CECL into regulatory capital in accordance with the interim final rule of the Board of Governors of the Federal Reserve System (FRB) and other U.S.

(17) Regulatory Capital Requirements

Financial institutions and their holding companies are subject to various regulatory capital requirements.

Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by the regulators that, if undertaken, could have a direct, material effect on a company’s financial statements.

Under capital adequacy guidelines and the regulatory framework for prompt corrective action, financial institutions must meet specific capital guidelines that involve quantitative measures of its assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting guidelines.

Capital amounts and classifications are also subject to qualitative judgments made by the regulators about components, risk-weighting and other factors.

Applicable rules limit an organization’s capital distributions and certain discretionary bonus payments if the organization does not hold a “ capital conservation buffer ” consisting of 2.5% of Total, Tier 1 and Common Equity Tier 1 ( “ CET1 ” ) capital to risk-weighted assets in addition to the amount necessary to meet its minimum risk-based capital requirements.

Quantitative measures established by regulation to ensure capital adequacy, require financial institutions to maintain minimum amounts and ratios (set forth in the table below) of Total, CET1 and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier 1 capital to average assets (as defined).

As of December 31, 2024 and 2023, we and our banking subsidiary exceeded all capital adequacy requirements to which we were subject and our regulatory capital ratios were above the minimum levels required to be considered “well capitalized” for regulatory purposes.

To be considered as “well capitalized,” we and our banking subsidiary must maintain regulatory capital ratios as set forth in the table.

We have elected to phase the estimated impact of CECL into regulatory capital in accordance with the interim final rule of the Federal Reserve Board and other U.S.

banking agencies that became effective on March 31, 2020.

2 unchanged sentences

Under the interim final rule, the estimated impact of CECL on regulatory capital that we will defer and later phase in is calculated as the entire day-one impact at adoption plus 25% of the subsequent change in allowance during the two-year deferral period.

As of December 15, 2023, the most recent assessment from FDIC, Northwest Bank exceeded all regulatory capital requirements and their regulatory capital ratios were above the minimum levels required to be considered “well-capitalized” for regulatory purposes .

To be considered as “well capitalized,” Northwest Bank must maintain total risk-based, Tier 1 risk-based, CET 1 risk-based, and Tier 1 leverage ratios as set forth in the table.

There are no conditions or events since that notification that management believes have changed the bank’s categories.

The actual, required, and well capitalized levels as of December 31, 2024 and 2023 were as follows:

13 unchanged sentences

Northwest Bancshares, Inc.

1,428,181 12.727 % 785,489 7.000 % 729,383 6.500 %

1,342,801 12.635 % 743,955 7.000 % N/A N/A

Northwest Bank 1,341,230 12.631 % 743,286 7.000 % 690,194 6.500 %

1 unchanged sentence

Northwest Bancshares, Inc.

1,553,766 10.841 % 573,290 4.000 % 716,612 5.000 %

1,468,646 10.390 % 565,426 4.000 % N/A N/A

Northwest Bank 1,341,230 9.496 % 564,937 4.000 % 706,171 5.000 %

(1) Amounts and ratios include the 2023 capital conservation buffer of 2.5 % with the exception of Tier 1 capital to average assets.

(1) The capital conservation buffer of 2.5 % does not apply to Tier 1 capital to average assets (leverage ratio).

For further information related to the capital conservation buffer, see “Item 1.

Business—Supervision and Regulation”.

(2) Reflects the well-capitalized standard applicable to Northwest Bank and the well-capitalized standard applicable to the Company under the Federal Reserve Board’s Regulation Y.

NORTHWEST BANCSHARES, INC.

16 unchanged sentences

Northwest Bancshares, Inc.

1,391,296 13.041 % 746,810 7.000 % 693,467 6.500 %

1,428,181 13.294 % 752,036 7.000 % N/A N/A

Northwest Bank 1,388,808 12.938 % 751,384 7.000 % 697,714 6.500 %

1 unchanged sentence

Northwest Bancshares, Inc.

1,516,621 10.817 % 560,816 4.000 % 701,020 5.000 %

1,428,181 10.841 % 573,290 4.000 % N/A N/A

Northwest Bank 1,388,808 9.697 % 572,903 4.000 % 716,128 5.000 %

(1) Amounts and ratios include the 2022 capital conservation buffer of 2.5 % with the exception of Tier 1 capital to average assets.

(1) The 2023 capital conservation buffer of 2.5 % does not apply to Tier 1 capital to average assets (leverage ratio).

For further information related to the capital conservation buffer, see “ Item 1.

Business—Supervision and Regulation”.

(2) Reflects the well-capitalized standard applicable to Northwest Bank and the well-capitalized standard applicable to the Company under the Federal Reserve Board’s Regulation Y.

(18) Contingent Liabilities

19 unchanged sentences

Unrealized gains and losses on securities

available-for-sale Change in

fair value of

interest rate

swaps Change in defined

available-for-sale Change in fair value of interest rate swaps Change in defined

benefit pension plans Total

10 unchanged sentences

The following table shows the changes in accumulated other comprehensive loss by component for the year ended December 31, 2023:

Unrealized gains and losses on securities available-for-sale Change in defined

benefit pension plans Total

Unrealized gains and losses on securities available-for-sale Change in fair value of interest rate swaps Change in

defined benefit pension plans Total

Balance as of January 1, $ ( 164,206 ) — ( 6,952 ) ( 171,158 )

3 unchanged sentences

Balance as of December 31, $ ( 150,659 ) ( 374 ) 1,541 ( 149,492 )

(1) Consists of unrealized holding losses, net of tax of $ 45,321 .

(1) Consists of unrealized holding gains, net of tax of $( 3,429 ).

(2) Change in fair value of interest rate swaps, net of tax of $ 110 .

(3) Consists of unrealized gains, net of tax of $( 3,961 ).

(3) Consists of realized gains, net of tax of $ 0 .

(4) Consists of realized losses, net of tax of $( 1,700 ).

(5) Consists of realized gains, net of tax of $ 607 .

1 unchanged sentence

Unrealized gains and losses on securities

available-for-sale Change in defined benefit pension plans Total

available-for-sale Change in

defined benefit pension plans Total

Balance as of January 1, $ ( 12,317 ) ( 25,312 ) ( 37,629 )

6 unchanged sentences

(3) Consists of realized gains, net of tax of $ 0 .

(4) Consists of realized losses, net of tax of $( 515 ).

(4) Consists of realized gains, net of tax of $ 202 .

(21) Segment Information

The Company’s reportable segment is determined by the Chief Executive Officer, who is the designated chief operating decision maker, based upon information provided about the Company’s products and services offered, primarily banking operations.

Our one operating segment, Banking, is also distinguished by the level of information provided to the chief operating decision maker, who uses such information to review performance of the various components of the business such as branches and lending, which are then aggregated because operating performance, products/services and customers are similar.

The chief operating decision maker will evaluate the financial performance of the Company’s business components such as by evaluating revenue streams, significant

NORTHWEST BANCSHARES, INC.

2 unchanged sentences

December 31, 2024, 2023 and 2022

expenses and budget to actual results in assessing the Company’s segment and in the determination of allocating resources.

The information reviewed is on a consolidated basis and discrete financial information is not available.

The chief operating decision maker uses revenue streams to evaluate product pricing and significant expenses to assess performance and evaluate return on assets.

The chief operating decision maker uses consolidated net income through return on average assets and return on average equity and the efficiency ratio, as well as loan growth to benchmark the Company against its competitors.

The benchmarking analysis coupled with monitoring of budget to actual results are used in assessment performance and in establishing compensation.

Loans, investments, and deposits provide the revenues in the banking operation.

Interest expense, provisions for credits losses and payroll provide the significant expenses in the banking operating.

All operations are domestic.

Accounting policies for segment are the same as those described in Note 1.

Segment performance is evaluated using consolidated net income.

Information reported internally for performance assessment by the chief operating decision maker follows, inclusive of reconciliations of significant segment totals to the financial statements:

Banking Segment

Years ended December 31,

2024 2023 2022

Interest income $ 669,196 587,922 448,798

Reconciliation of revenue

Service charges and fees 62,957 59,214 55,188

Trust and other financial services income 30,102 27,284 27,765

Loss on sale of investments ( 39,413 ) ( 8,307 ) ( 8 )

Other revenue (1)

33,364 35,632 27,904

Consolidated revenues $ 756,206 701,745 559,647

Interest expense 233,618 152,239 28,117

Segment net interest income and noninterest income $ 522,588 549,506 531,530

Provision for credit losses 24,505 22,874 28,315

Compensation and employee benefits 214,455 195,691 188,359

Processing expenses 59,351 58,687 52,496

Premises and occupancy costs 29,469 29,151 29,618

Professional services 14,883 17,819 14,703

Office operations 12,433 12,955 13,318

Federal deposit insurance premiums 11,600 9,271 4,778

Other segment items (2) 26,346 27,980 26,251

Income tax expense 29,268 40,121 40,026

Segment net income/consolidated net income $ 100,278 134,957 133,666

(1) Other revenues include loan sales, gain on real estate owned, income from bank owned life insurance and other operating income.

(2) Other segment items include expenses for collections, marketing, amortization of intangibles, real estate owned, merger, asset disposition and restructuring and other operating expense.

Banking Segment

Years ended December 31,

2024 2023 2022

Other segment disclosures

Interest income $ 669,196 587,922 448,798

Interest expense 233,618 152,239 28,117

Depreciation 11,259 11,492 11,602

Amortization 2,452 3,270 4,277

Other significant noncash items:

Provision for credit losses 24,505 22,874 28,315

Segment assets 14,408,224 14,419,105 14,113,324

Expenditures for segment assets 4,618 2,275 5,863

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

(22) Parent Company Only Financial Statements - Condensed

45 unchanged sentences

Net cash used in financing activities ( 99,401 ) ( 101,039 ) ( 96,295 )

Net increase/(decrease) in cash and cash equivalents $ 101,924 46,101 ( 44,141 )

Net (decrease)/increase in cash and cash equivalents $ ( 37,060 ) 101,924 46,101

Cash and cash equivalents at beginning of period $ 276,026 174,102 128,001

Net increase/(decrease) in cash and cash equivalents 101,924 46,101 ( 44,141 )

Net (decrease)/increase in cash and cash equivalents ( 37,060 ) 101,924 46,101

Cash and cash equivalents at end of period $ 238,966 276,026 174,102

10 unchanged sentences

Our risk management objective and strategy for these interest rate swaps at such time was to reduce our exposure to variability in interest-related cash outflows attributable to changes in the USD-SOFR swap rate, the designated benchmark interest rate being hedged.

Based upon our contemporaneous quantitative analysis at the inception of each interest rate swap, we have determined these interest rate swaps qualified for hedge accounting in accordance with ASC 815, Derivatives and Hedging .

Based upon our contemporaneous quantitative analysis at the inception of each interest rate swap, we have determined these interest rate swaps qualify for hedge accounting in accordance with ASC 815, Derivatives and Hedging .

Our cash flow hedges are recorded within other assets on the Consolidated Statement of Financial Condition at their estimated fair value.

As long as the hedge remains highly effective, the changes in the fair value of derivatives designated, and that qualify, as cash flow hedges are recorded in accumulated other comprehensive income and are subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings.

A hedging relationship that is determined to not be highly effective no longer qualifies for hedge accounting and any gain or loss is recognized immediately in earnings.

A hedging relationship that is determined to not be highly effective no longer qualifies for hedge accounting and any gain or loss is recognized immediately into earnings.

Amounts reclassified into earnings are included in interest expense in the Consolidated Statement of Income.

16 unchanged sentences

These risk participation agreements are recorded within other liabilities on the Consolidated Statement of Financial Condition at their estimated fair value.

Changes to the fair value of the the risk participation agreements are included in other operating income in the Consolidated Statement of Income.

Changes to the fair value of the risk participation agreements are included in other operating income in the Consolidated Statement of Income.

NORTHWEST BANCSHARES, INC.

3 unchanged sentences

The following table presents information regarding our derivative financial instruments at the dates indicated.

Amounts in the table below are presented gross without the impact of any net collateral agreements (in thousands):

Asset derivatives Liability derivatives

11 unchanged sentences

At December 31, 2023

Derivatives designated as hedging instruments:

Interest rate swap agreements $ 75,000 713 100,000 1,198

Derivatives not designated as hedging instruments:

5 unchanged sentences

Total derivatives $ 822,277 42,772 939,144 42,940

The following table presents income or expenses recognized on derivatives for the periods indicated:

The following table presents income or expenses recognized on derivatives for the periods indicated (in thousands):

For the years ended December 31,

3 unchanged sentences

Non-hedging swap derivatives:

(Decrease)/increase in other income ( 613 ) ( 83 ) 1,033

Increase/(decrease) in other income 444 ( 613 ) ( 83 )

(Decrease)/increase in mortgage banking income ( 277 ) ( 34 ) 1,368

11 unchanged sentences

Total $ 175,000 $ ( 1,509 )

NORTHWEST BANCSHARES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024, 2023 and 2022

Our derivatives are presented on a net basis taking into consideration the effects of legally enforceable master netting agreements.

Additionally, collateral exchanged with counterparties is also netted against the applicable derivative fair values.

We enter into derivative transactions with two primary groups, banks and our customers.

Different methods are utilized for managing counterparty credit exposure and credit risk for each of these groups.

The following tables present the gross amounts of these assets and liabilities with any offsets to arrive at the net amounts recognized in the Consolidated Statements of Financial Condition as of December 31, 2024 (1) (dollars in thousands).

Derivative assets Gross amounts of

recognized assets Gross amounts offset in

the consolidated statement

of financial condition Net amounts of

assets presented in the consolidated of condition

Interest rate swaps - hedging $ 1,529 ( 32 ) 1,497

Interest rate swaps - not hedging 37,697 ( 34,204 ) 3,493

Derivative liabilities Gross amounts of

recognized liabilities Gross amounts offset in

the consolidated statement

of financial condition Net amounts of

liabilities presented in

the consolidated of condition

Interest rate swaps - hedging $ 32 ( 32 ) —

Interest rate swaps - not hedging 37,767 ( 2,362 ) 35,405

(1) Amounts were not meaningful in 2023 .

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

1 unchanged sentence

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 8. Financial Statements and Supplementary Data