Northwest Bancshares, Inc. Announces Fourth Quarter 2013 Earnings and Dividend Declaration

WARREN, Pa., Jan. 24, 2014 /PRNewswire/ -- Northwest Bancshares, Inc. (NasdaqGS: NWBI) announced net income for the quarter ended December 31, 2013 of $20.4 million, or $0.22 per diluted share. This represents an increase of $4.1 million, or 24.7%, over the same quarter last year when net income was $16.3 million, or $0.18 per diluted share, and an increase of $2.8 million, or 15.7%, compared to the quarter ended September 30, 2013 when net income was $17.6 million, or $0.19 per diluted share. The annualized returns on average shareholders' equity and average assets for the current quarter were 7.06% and 1.02% compared to 5.65% and 0.81% for the same quarter last year and 6.18% and 0.88% for the quarter ended September 30, 2013.

For the year ended December 31, 2013 net income was $66.7 million which represents an increase of $3.1 million, or 5.0%, compared to net income of $63.6 million for the year ended December 31, 2012. Diluted earnings per share for the year ended December 31, 2013 increased to $0.73 from $0.68 for the year ended December 31, 2012. The returns on average shareholders' equity and average assets were 5.88% and 0.84%, respectively, for the current year compared to 5.48% and 0.79%, respectively, in the prior year.

The Company also announced that its Board of Directors declared a regular quarterly cash dividend of $0.13 per share and a special cash dividend of $0.10 per share, both payable on February 13, 2014, to shareholders of record as of February 3, 2014. This represents the 77^th consecutive quarter in which the Company has paid a cash dividend.

In making this announcement, William J. Wagner, President and CEO, noted, "Given the continued consistency in annual earnings and our robust capital position, we are pleased to return some excess capital to our shareholders in the form of a special dividend of $0.10 per share. We are also pleased to report positive trends in the most challenging areas of our operation. While our net interest margin continues to shrink, the rate of contraction has slowed, as we lost only two basis points per quarter over the past two quarters. We continued to experience solid loan growth with a $75 million increase during the quarter, split proportionately between the personal and commercial portfolios. Classified and nonaccrual loans continued to decrease which resulted in the recording of the lowest quarterly provision for loan losses since the credit crisis began in 2008."

Net interest income decreased by $4.3 million, or 6.4%, to $62.0 million for the quarter ended December 31, 2013, from $66.3 million for the quarter ended December 31, 2012, as decreases in interest income on loans receivable and investment securities of $5.5 million and $816,000, respectively, were partially offset by a $2.1 million decrease in interest paid on deposit accounts. These changes from the previous year were due primarily to the continued low level of market interest rates.

The provision for loan losses decreased by $7.2 million, or 88.2%, to $964,000 for the quarter ended December 31, 2013, from $8.2 million for the quarter ended December 31, 2012. Loans 90 days or more delinquent decreased by $10.5 million, or 15.5%, to $57.8 million at December 31, 2013 from $68.3 million at December 31, 2012. Additionally, criticized loans decreased by $36.5 million, or 11.0%, to $295.5 million at December 31, 2013 from $332.0 million at December 31, 2012. At December 31, 2013, the allowance for loan losses was $71.3 million, or 1.23% of total loans, compared to $73.2 million, or 1.28% of total loans, at December 31, 2012. Net charge-offs were $5.5 million, or 0.38% for the quarter ended December 31, 2013 compared to $6.1 million, or 0.43% for the same quarter last year.

Noninterest income increased by $6.2 million, or 42.6%, to $20.9 million for the quarter ended December 31, 2013, from $14.7 million for the quarter ended December 31, 2012. This increase is due primarily to a $5.5 million increase in the gain on sale of investments. Additionally, the loss on the sale of real estate owned decreased by $2.1 million as the portfolio of foreclosed real estate decreased by $8.0 million, or 30.4%, compared to last year. Partially offsetting these increases was a decrease in mortgage banking income of $1.6 million, due primarily to retaining all new residential mortgage originations.

Noninterest expense increased by $2.2 million, or 4.3%, to $52.6 million for the quarter ended December 31, 2013, from $50.4 million for the quarter ended December 30, 2012, due primarily to an increase in marketing expense of $1.1 million which was due to the timing of various campaigns in the current and prior year.

Headquartered in Warren, Pennsylvania, Northwest Bancshares, Inc. is the holding company of Northwest Savings Bank. Founded in 1896, Northwest Savings Bank is a full-service financial institution offering a complete line of business and personal banking products, employee benefits and wealth management services, as well as the fulfillment of business and personal insurance needs. Northwest operates 165 community banking offices in Pennsylvania, New York, Ohio and Maryland and 50 consumer finance offices in Pennsylvania through its subsidiary, Northwest Consumer Discount Company. Northwest Bancshares, Inc.'s common stock is listed on the NASDAQ Global Select Market. Additional information regarding Northwest Bancshares, Inc. can be accessed on-line at www.northwestsavingsbank.com.

Forward-Looking Statements - This release may contain forward-looking statements with respect to the financial condition and results of operations of Northwest Bancshares, Inc. including, without limitations, statements relating to the earnings outlook of the Company. These forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements, include among others, the following possibilities: (1) changes in the interest rate environment; (2) competitive pressure among financial services companies; (3) general economic conditions including an increase in non-performing loans; (4) changes in legislation or regulatory requirements; (5) difficulties in continuing to improve operating efficiencies; (6) difficulties in the integration of acquired businesses; and (7) increased risk associated with an increase in commercial real-estate and business loans. Management has no obligation to revise or update these forward-looking statements to reflect events or circumstances that arise after the date of this release.

Northwest Bancshares, Inc. and Subsidiaries
Consolidated Statements of Financial Condition
(Dollars in thousands, except per share amounts)

			December 31,
Assets			2013	2012
Cash and cash equivalents			$ 98,122	88,277
Interest-earning deposits in other financial institutions			293,149	362,794
Federal funds sold and other short-term investments			634	633
Marketable securities available-for-sale (amortized cost of $1,022,078 and $1,053,122)			1,016,767	1,079,074
Marketable securities held-to-maturity (fair value of $124,061 and $161,969)			121,366	155,081
	Total cash, interest-earning deposits and marketable securities		1,530,038	1,685,859

Residential mortgage loans held for sale			221	15,441
Residential mortgage loans			2,482,783	2,400,208
Home equity loans			1,083,939	1,083,654
Other consumer loans			228,348	228,350
Commercial real estate loans			1,608,399	1,585,833
Commercial loans			402,601	388,994
	Total loans receivable		5,806,291	5,702,480
Allowance for loan losses			(71,348)	(73,219)
	Loans receivable, net		5,734,943	5,629,261

Federal Home Loan Bank stock, at cost			43,715	46,834
Accrued interest receivable			21,821	23,313
Real estate owned, net			18,203	26,165
Premises and Equipment, net			146,139	138,824
Bank owned life insurance			140,172	137,044
Goodwill and other intangible assets			174,463	174,461
Other intangible assets			2,319	3,529
Other assets			72,754	77,310
	Total assets		$ 7,884,567	7,942,600

Liabilities and Shareholders' equity
Liabilities
Noninterest-bearing demand deposits			$ 789,135	755,429
Interest-bearing demand deposits			852,809	851,771
Savings deposits			2,359,538	2,271,311
Time deposits			1,667,397	1,886,089
	Total deposits		5,668,879	5,764,600
Borrowed funds			881,645	860,047
Advances by borrowers for taxes and insurance			26,669	23,325
Accrued interest payable			888	888
Other liabilities			43,499	62,177
Junior subordinated debentures			103,094	103,094
	Total liabilities		6,724,674	6,814,131

Shareholders' equity
Preferred stock, $0.01 par value, 50,000,000 shares authorized, no shares issued			-	-
Common stock, $0.01 par value: 500,000,000 shares authorized, 94,243,713 shares
	and 93,652,960 shares issued and outstanding, respectively		943	937
Paid-in-capital			619,678	613,249
Retained earnings			571,164	550,296
Unallocated common stock of Employee Stock Ownership Plan			(23,083)	(24,525)
Accumulated other comprehensive loss			(8,809)	(11,488)
	Total shareholders' equity		1,159,893	1,128,469
	Total liabilities and shareholders' equity		$ 7,884,567	7,942,600

		Equity to assets	14.72%	14.21%
		Tangible common equity to assets	12.76%	12.24%
		Book value per share	$ 12.29	12.05
		Tangible book value per share	$ 10.42	10.15
		Closing market price per share	$ 14.78	12.14
		Full time equivalent employees	2,043	2,042
		Number of banking offices	165	165

Northwest Bancshares, Inc. and Subsidiaries
Consolidated Statements of Income
(Dollars in thousands, except per share amounts)

				Quarter ended
				December 31,		September 30,
				2013	2012	2013
Interest income:
	Loans receivable			$ 70,849	76,366	71,480
	Mortgage-backed securities			2,956	3,697	3,113
	Taxable investment securities			1,052	743	1,030
	Tax-free investment securities			1,748	2,132	1,912
	Interest-earning deposits			249	382	253
		Total interest income		76,854	83,320	77,788

Interest expense:
	Deposits			6,911	9,042	7,150
	Borrowed funds			7,894	7,998	8,126
		Total interest expense		14,805	17,040	15,276

		Net interest income		62,049	66,280	62,512
Provision for loan losses				964	8,173	4,992
		Net interest income after provision
		for loan losses		61,085	58,107	57,520

Noninterest income:
	Impairment losses on securities			(713)	-	-
	Noncredit related losses on securities not expected
		to be sold (recognized in other comprehensive income)		-	-	-
	Net impairment losses			(713)	-	-
	Gain on sale of investments, net			5,889	394	109
	Service charges and fees			8,874	8,922	9,282
	Trust and other financial services income			2,483	2,288	2,380
	Insurance commission income			2,131	1,463	2,019
	Loss on real estate owned, net			(660)	(2,804)	(111)
	Income from bank owned life insurance			1,846	1,589	1,178
	Mortgage banking income			228	1,874	203
	Other operating income			869	964	1,049
		Total noninterest income		20,947	14,690	16,109

Noninterest expense:
	Compensation and employee benefits			28,475	28,302	27,629
	Premises and occupancy costs			5,652	5,680	5,633
	Office operations			3,823	3,419	3,497
	Processing expenses			6,269	6,459	6,036
	Marketing expenses			1,259	134	1,032
	Federal deposit insurance premiums			1,361	1,211	1,377
	Professional services			2,044	1,869	1,331
	Amortization of intangible assets			222	219	291
	Real estate owned expense			557	477	681
	Other expense			2,918	2,662	2,770
		Total noninterest expense		52,580	50,432	50,277

		Income before income taxes		29,452	22,365	23,352
	Income tax expense			9,089	6,040	5,752

			Net income	$ 20,363	16,325	17,600

Basic earnings per share				$ 0.22	0.18	0.19

Diluted earnings per share				$ 0.22	0.18	0.19

Annualized return on average equity				7.06%	5.65%	6.18%
Annualized return on average assets				1.02%	0.81%	0.88%

Basic common shares outstanding				90,864,076	92,716,973	90,760,402
Diluted common shares outstanding				92,245,167	92,929,614	91,824,384

Northwest Bancshares, Inc. and Subsidiaries
Consolidated Statements of Income
(Dollars in thousands, except per share amounts)

				Year ended
				December 31,
				2013	2012
Interest income:
	Loans receivable			$ 287,289	308,254
	Mortgage-backed securities			12,818	16,738
	Taxable investment securities			4,021	2,328
	Tax-free investment securities			7,817	9,119
	Interest-earning deposits			1,093	1,599
		Total interest income		313,038	338,038

Interest expense:
	Deposits			29,279	43,377
	Borrowed funds			31,883	31,822
		Total interest expense		61,162	75,199

		Net interest income		251,876	262,839
Provision for loan losses				18,519	26,338
		Net interest income after provision
		for loan losses		233,357	236,501

Noninterest income:
	Impairment losses on securities			(713)	(996)
	Noncredit related losses on securities not expected
		to be sold (recognized in other comprehensive income)		-	665
	Net impairment losses			(713)	(331)
	Gain on sale of investments, net			6,118	654
	Service charges and fees			35,884	35,623
	Trust and other financial services income			9,330	8,544
	Insurance commission income			8,635	6,264
	Loss on real estate owned, net			(3,186)	(5,643)
	Income from bank owned life insurance			5,197	4,961
	Mortgage banking income			1,623	4,678
	Other operating income			3,959	4,154
		Total noninterest income		66,847	58,904

Noninterest expense:
	Compensation and employee benefits			112,190	111,727
	Premises and occupancy costs			23,182	22,409
	Office operations			14,454	13,224
	Processing expenses			25,548	25,000
	Marketing expenses			6,284	7,829
	Federal deposit insurance premiums			5,600	5,554
	Professional services			6,267	7,005
	Amortization of intangible assets			1,210	1,012
	Real estate owned expense			2,437	2,620
	Other expense			9,962	9,097
		Total noninterest expense		207,134	205,477

		Income before income taxes		93,070	89,928
	Income tax expense			26,331	26,368

			Net income	$ 66,739	63,560

Basic earnings per share				$ 0.74	0.68

Diluted earnings per share				$ 0.73	0.68

Annualized return on average equity				5.88%	5.48%
Annualized return on average assets				0.84%	0.79%

Basic common shares outstanding				90,626,324	93,912,821
Diluted common shares outstanding				91,470,819	94,201,374

Northwest Bancshares, Inc. and Subsidiaries
Asset quality
(Dollars in thousands)

		December 31, 2013	December 31, 2012	December 31, 2011	December 31, 2010

Non-accrual loans current:
	Residential mortgage loans	$ 1,361	797	-	-
	Home equity loans	835	635	-	-
	Other consumer loans	98	44	-	-
	Commercial real estate loans	17,866	24,960	13,057	7,378
	Commercial loans	13,357	5,424	13,480	23,317
Total non-accrual loans current		$ 33,517	31,860	26,537	30,695

Non-accrual loans delinquent 30 days to 59 days:
	Residential mortgage loans	$ 427	-	-	-
	Home equity loans	404	-	-	-
	Other consumer loans	15	-	-	-
	Commercial real estate loans	3,468	5,549	3,274	4,039
	Commercial loans	7,650	2,002	90	1,465
Total non-accrual loans delinquent 30 days to 59 days		$ 11,964	7,551	3,364	5,504

Non-accrual loans delinquent 60 days to 89 days:
	Residential mortgage loans	$ 864	-	-	-
	Home equity loans	280	-	-	-
	Other consumer loans	87	-	-	-
	Commercial real estate loans	2,036	2,802	1,560	10,923
	Commercial loans	716	9,652	3,808	848
Total non-accrual loans delinquent 60 days to 89 days		$ 3,983	12,454	5,368	11,771

Non-accrual loans delinquent 90 days or more:
	Residential mortgage loans	$ 24,625	24,286	28,221	29,751
	Home equity loans	8,344	8,479	9,560	10,263
	Other consumer loans	2,057	1,936	2,667	2,565
	Commercial real estate loans	18,433	24,550	44,603	44,965
	Commercial loans	4,298	9,096	10,785	12,877
Total non- accrual loans delinquent 90 days or more		$ 57,757	68,347	95,836	100,421

Total non-accrual loans		$ 107,221	120,212	131,105	148,391


		December 31,	December 31,	December 31,	December 31,
		2013	2012	2011	2010

Non-accrual loans		$ 107,221	120,212	131,105	148,391
Loans 90 days past maturity and still accruing		690	1,698	510	1,067
Nonperforming loans		107,911	121,910	131,615	149,458
Real estate owned, net		18,203	26,165	26,887	20,780
Nonperforming assets		$ 126,114	148,075	158,502	170,238

Non-accrual troubled debt restructuring *		$ 28,889	41,166	29,575	41,740
Accruing troubled debt restructuring		50,277	48,278	39,854	10,865
Total troubled debt restructuring		$ 79,166	89,444	69,429	52,605

Nonperforming loans to total loans		1.86%	2.14%	2.37%	2.70%

Nonperforming assets to total assets		1.60%	1.86%	1.99%	2.09%

Allowance for loan losses to total loans		1.23%	1.28%	1.28%	1.38%

Allowance for loan losses to nonperforming loans		66.12%	60.06%	54.05%	51.13%

* Amounts included in nonperforming loans above.

Northwest Bancshares, Inc. and Subsidiaries
Delinquency
(Dollars in thousands)



Loan delinquency schedule
	(Number of loans and dollar amount of loans)
		December 31,			December 31,			December 31,			December 31,
		2013		*	2012		*	2011		*	2010		*
Loans delinquent 30 days to 59 days:
	Residential mortgage loans	374	$ 27,486	1.1%	430	$ 32,921	1.4%	427	$ 33,671	1.4%	427	$ 35,329	1.5%
	Home equity loans	213	6,946	0.6%	224	6,534	0.6%	222	7,426	0.7%	230	7,317	0.7%
	Consumer loans	1,010	4,515	2.0%	1,122	5,456	2.4%	903	4,854	2.0%	1,008	5,318	2.1%
	Commercial real estate loans	73	8,449	0.5%	87	13,001	0.8%	104	10,680	0.7%	82	16,287	1.2%
	Commercial loans	34	9,243	2.3%	41	3,233	0.8%	32	2,027	0.5%	48	6,590	1.5%
Total loans delinquent 30 days to 59 days		1,704	$ 56,639	1.0%	1,904	$ 61,145	1.1%	1,688	58,658	1.1%	1,795	$ 70,841	1.3%

Loans delinquent 60 days to 89 days:
	Residential mortgage loans	103	$ 7,568	0.3%	100	$ 9,387	0.4%	99	$ 8,629	0.4%	106	$ 9,848	0.4%
	Home equity loans	67	2,243	0.2%	65	1,977	0.2%	47	1,953	0.2%	81	3,249	0.3%
	Consumer loans	507	1,866	0.8%	448	1,830	0.8%	412	1,787	0.7%	356	1,331	0.5%
	Commercial real estate loans	35	3,968	0.2%	33	4,596	0.3%	38	3,122	0.2%	39	14,365	1.1%
	Commercial loans	16	1,555	0.4%	17	10,158	2.6%	25	4,958	1.3%	9	1,678	0.4%
Total loans delinquent 60 days to 89 days		728	$ 17,200	0.3%	663	$ 27,948	0.5%	621	20,449	0.4%	591	$ 30,471	0.6%

Loans delinquent 90 days or more:
	Residential mortgage loans	273	$ 24,625	1.0%	266	$ 24,286	1.0%	273	$ 28,221	1.2%	275	$ 29,751	1.2%
	Home equity loans	171	8,344	0.8%	175	8,479	0.8%	177	9,560	0.9%	190	10,263	0.9%
	Consumer loans	470	2,057	0.9%	427	1,936	0.8%	456	2,667	1.1%	374	2,565	1.0%
	Commercial real estate loans	124	18,433	1.1%	146	24,550	1.5%	131	44,603	3.1%	181	44,965	3.3%
	Commercial loans	31	4,298	1.1%	61	9,096	2.3%	66	10,785	2.8%	111	12,877	3.0%
Total loans delinquent 90 days or more		1,069	$ 57,757	1.0%	1,075	$ 68,347	1.2%	1,103	95,836	1.7%	1,131	$ 100,421	1.8%

Total loans delinquent		3,501	$ 131,596	2.3%	3,642	$ 157,440	2.8%	3,412	$ 174,943	3.2%	3,517	$ 201,733	3.7%

	* - Represents delinquency, in dollars, divided by the respective total amount of that type of loan outstanding.

Northwest Bancshares, Inc. and Subsidiaries
Loans by credit quality indicators as of December 31, 2013
(Dollars in thousands)

								Recorded
								investment
				Special				in loans
			Pass	mention	Substandard	Doubtful	Loss	receivable
Personal Banking:
		Residential mortgage loans	$ 2,464,057	-	17,626	-	1,321	2,483,004
		Home equity loans	1,075,595	-	8,344	-	-	1,083,939
		Other consumer loans	226,922	-	1,426	-	-	228,348
	Total Personal Banking		3,766,574	-	27,396	-	1,321	3,795,291

Business Banking:
		Commercial real estate loans	1,398,652	46,557	161,906	1,284	-	1,608,399
		Commercial loans	345,612	12,045	43,040	1,904	-	402,601
	Total Business Banking		1,744,264	58,602	204,946	3,188	-	2,011,000

			$ 5,510,838	58,602	232,342	3,188	1,321	5,806,291


Northwest Bancshares, Inc. and Subsidiaries
Loans by credit quality indicators as of December 31, 2012
(Dollars in thousands)

								Recorded
								investment
				Special				in loans
			Pass	mention	Substandard	Doubtful	Loss	receivable
Personal Banking:
		Residential mortgage loans	$ 2,395,809	-	18,743	48	1,049	2,415,649
		Home equity loans	1,075,200	-	8,454	-	-	1,083,654
		Other consumer loans	227,089	-	1,261	-	-	228,350
	Total Personal Banking		3,698,098	-	28,458	48	1,049	3,727,653

Business Banking:
		Commercial real estate loans	1,352,118	68,130	163,751	1,834	-	1,585,833
		Commercial loans	320,228	13,077	52,742	2,947	-	388,994
	Total Business Banking		1,672,346	81,207	216,493	4,781	-	1,974,827

			$ 5,370,444	81,207	244,951	4,829	1,049	5,702,480

Northwest Bancshares, Inc. and Subsidiaries
Allowance for loan losses
(Dollars in thousands)

		Quarter ended		Year ended
		December 31,		December 31,
		2013	2012	2013	2012
Allowance for loan losses
	Beginning balance	$ 75,865	71,177	73,219	71,138
	Provision	964	8,173	18,519	26,338
	Charge-offs residential mortgage	(499)	(836)	(2,501)	(4,295)
	Charge-offs home equity	(851)	(1,317)	(2,239)	(4,066)
	Charge-offs other consumer	(1,696)	(1,592)	(6,055)	(5,919)
	Charge-offs commercial real estate	(2,308)	(4,102)	(10,042)	(9,919)
	Charge-offs commercial	(1,322)	(1,245)	(5,007)	(6,254)
	Recoveries	1,195	2,961	5,454	6,196
	Ending balance	$ 71,348	73,219	71,348	73,219


Net charge-offs to average loans, annualized		0.38%	0.43%	0.36%	0.43%

Northwest Bancshares, Inc. and Subsidiaries
Municipal securities portfolio
(Dollars in thousands)

			December 31, 2013			As a % of
			Market	Amortized	Unrealized	amortized
			value	cost	gain/ (loss)	cost
Municipal securities by state:
	Pennsylvania
		School districts	$ 76,736	75,767	969	47.1%
		General obligations	28,745	28,264	481	17.6%
		Revenue bonds	1,071	1,080	(9)	0.7%
	Total Pennsylvania		106,552	105,111	1,441	65.4%
	New York		15,857	15,665	192	9.7%
	Ohio		5,980	5,975	5	3.7%
	All other states		34,828	34,014	814	21.2%
			$ 163,217	160,765	2,452


			December 31, 2012			As a % of
			Market	Amortized	Unrealized	amortized
			value	cost	gain	cost
Municipal securities by state:
	Pennsylvania
		School districts	$ 96,271	91,951	4,320	46.7%
		General obligations	37,205	35,418	1,787	18.0%
		Revenue bonds	3,006	2,948	58	1.5%
	Total Pennsylvania		136,482	130,317	6,165	66.2%
	New York		26,831	25,954	877	13.2%
	Ohio		6,390	5,973	417	3.0%
	All other states		37,683	34,659	3,024	17.6%
			$ 207,386	196,903	10,483

Northwest Bancshares, Inc. and Subsidiaries
Average balance sheet
(Dollars in thousands)

The following table sets forth certain information relating to the Company's average balance sheet and reflects the average yield on assets and
average cost of liabilities for the periods indicated. Such yields and costs are derived by dividing income or expense by the average balance of
assets or liabilities, respectively, for the periods presented. Average balances are calculated using daily averages.

	Quarter ended December 31,
	2013			2012
	Average	Interest	Avg.	Average	Interest	Avg.
	Balance		Yield/	Balance		Yield/
			Cost (g)			Cost (g)
Assets:
Interest-earning assets:
Loans receivable (a) (b) (d)	$ 5,762,308	71,421	4.96%	$ 5,709,603	76,944	5.39%
Mortgage-backed securities (c)	653,526	2,956	1.81%	717,028	3,697	2.06%
Investment securities (c) (d)	528,612	3,740	2.83%	408,925	4,022	3.93%
FHLB stock	43,715	180	1.65%	46,833	51	0.44%
Other interest-earning deposits	373,694	249	0.26%	608,772	382	0.25%

Total interest-earning assets	7,361,855	78,546	4.27%	7,491,161	85,096	4.54%

Noninterest earning assets (e)	541,511			502,514

Total assets	$ 7,903,366			$ 7,993,675

Liabilities and shareholders' equity:
Interest-bearing liabilities:
Savings accounts	$ 1,191,476	919	0.31%	$ 1,145,405	1,019	0.35%
Interest-bearing demand accounts	851,356	144	0.07%	837,955	145	0.07%
Money market accounts	1,160,520	783	0.27%	1,115,655	842	0.30%
Certificate accounts	1,690,251	5,065	1.19%	1,923,699	7,036	1.46%
Borrowed funds (f)	889,920	6,711	2.99%	864,085	6,562	3.02%
Junior subordinated debentures	103,094	1,183	4.49%	103,094	1,436	5.45%

Total interest-bearing liabilities	5,886,617	14,805	1.00%	5,989,893	17,040	1.13%

Noninterest bearing checking	808,732			751,164
Noninterest bearing liabilities	64,338			103,622

Total liabilities	6,759,687			6,844,679

Shareholders' equity	1,143,679			1,148,996

Total liabilities and shareholders' equity	$ 7,903,366			$ 7,993,675

Net interest income/ Interest rate spread		63,741	3.27%		68,056	3.41%

Net interest-earning assets/ Net interest margin	$ 1,475,238		3.46%	$ 1,501,268		3.63%

Ratio of interest-earning assets to
interest-bearing liabilities	1.25X			1.25X

(a) Average gross loans receivable includes loans held as available-for-sale and loans placed on nonaccrual status.
(b) Interest income includes accretion/ amortization of deferred loan fees/ expenses, which was not material.
(c) Average balances do not include the effect of unrealized gains or losses on securities held as available-for-sale.
(d) Interest income on tax-free investment securities and tax-free loans are presented on a fully taxable equivalent basis.
(e) Average balances include the effect of unrealized gains or losses on securities held as available-for-sale.
(f) Average balances include FHLB borrowings and securities sold under agreements to repurchase.
(g) Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 4.92% and 5.35%, respectively, Investment securities - 2.12%
and 2.81%, respectively, Interest-earning assets - 4.19% and 4.45%, respectively. GAAP basis net interest rate spreads were 3.19% and
3.32%, respectively, and GAAP basis net interest margins were 3.38% and 3.54%, respectively.

Northwest Bancshares, Inc. and Subsidiaries
Average balance sheet
(Dollars in thousands)

The following table sets forth certain information relating to the Company's average balance sheet and reflects the average yield on assets and
average cost of liabilities for the periods indicated. Such yields and costs are derived by dividing income or expense by the average balance of
assets or liabilities, respectively, for the periods presented. Average balances are calculated using daily averages.

	Year ended December 31,
	2013			2012
	Average	Interest	Avg.	Average	Interest	Avg.
	Balance		Yield/	Balance		Yield/
			Cost (g)			Cost (g)
Assets:
Interest-earning assets:
Loans receivable (a) (b) (d)	$ 5,682,431	289,547	5.10%	$ 5,655,179	310,513	5.49%
Mortgage-backed securities (c)	701,589	12,818	1.83%	736,896	16,738	2.27%
Investment securities (c) (d)	518,753	16,047	3.09%	353,431	16,357	4.63%
FHLB stock	46,580	371	0.80%	47,205	87	0.18%
Other interest-earning deposits	410,022	1,093	0.26%	638,366	1,599	0.25%

Total interest-earning assets	7,359,375	319,876	4.35%	7,431,077	345,294	4.65%

Noninterest earning assets (e)	572,082			581,429

Total assets	$ 7,931,457			$ 8,012,506

Liabilities and shareholders' equity:
Interest-bearing liabilities:
Savings accounts	$ 1,197,931	3,595	0.30%	$ 1,136,774	4,219	0.37%
Interest-bearing demand accounts	855,031	576	0.07%	822,626	792	0.10%
Money market accounts	1,133,584	3,042	0.27%	1,047,894	3,605	0.34%
Certificate accounts	1,766,219	22,066	1.25%	2,059,702	34,761	1.69%
Borrowed funds (f)	868,638	26,439	3.04%	850,171	26,105	3.07%
Junior subordinated debentures	103,094	5,444	5.21%	103,094	5,717	5.47%

Total interest-bearing liabilities	5,924,497	61,162	1.03%	6,020,261	75,199	1.25%

Noninterest bearing checking	784,279			723,666
Noninterest bearing liabilities	87,193			109,483

Total liabilities	6,795,969			6,853,410

Shareholders' equity	1,135,488			1,159,096

Total liabilities and shareholders' equity	$ 7,931,457			$ 8,012,506

Net interest income/ Interest rate spread		258,714	3.32%		270,095	3.40%

Net interest-earning assets/ Net interest margin	$ 1,434,878		3.52%	$ 1,410,816		3.63%

Ratio of interest-earning assets to
interest-bearing liabilities	1.24X			1.23X

(a) Average gross loans receivable includes loans held as available-for-sale and loans placed on nonaccrual status.
(b) Interest income includes accretion/ amortization of deferred loan fees/ expenses, which was not material.
(c) Average balances do not include the effect of unrealized gains or losses on securities held as available-for-sale.
(d) Interest income on tax-free investment securities and tax-free loans are presented on a fully taxable equivalent basis.
(e) Average balances include the effect of unrealized gains or losses on securities held as available-for-sale.
(f) Average balances include FHLB borrowings and securities sold under agreements to repurchase.
(g) Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 5.06% and 5.45%, respectively, Investment securities - 2.28%
and 3.24%, respectively, Interest-earning assets - 4.26% and 4.55%, respectively. GAAP basis net interest rate spreads were 3.23% and
3.30%, respectively, and GAAP basis net interest margins were 3.43% and 3.54%, respectively.

Northwest Bancshares, Inc. and Subsidiaries
Average balance sheet
(Dollars in thousands)

The following table sets forth certain information relating to the Company's average balance sheet and reflects the average yield on assets and
average cost of liabilities for the periods indicated. Such yields and costs are derived by dividing income or expense by the average balance of
assets or liabilities, respectively, for the periods presented. Average balances are calculated using daily averages.

	Quarter ended			Quarter ended
	December 31, 2013			September 30, 2013
	Average	Interest	Avg.	Average	Interest	Avg.
	Balance		Yield/	Balance		Yield/
			Cost (g)			Cost (g)
Assets:
Interest-earning assets:
Loans receivable (a) (b) (d)	$ 5,762,308	71,421	4.96%	$ 5,703,527	72,051	5.05%
Mortgage-backed securities (c)	653,526	2,956	1.81%	701,510	3,113	1.78%
Investment securities (c) (d)	528,612	3,740	2.83%	545,005	3,972	2.92%
FHLB stock	43,715	180	1.65%	47,650	120	1.01%
Other interest-earning deposits	373,694	249	0.26%	376,699	253	0.26%

Total interest-earning assets	7,361,855	78,546	4.27%	7,374,391	79,509	4.31%

Noninterest earning assets (e)	541,511			553,189

Total assets	$ 7,903,366			$ 7,927,580

Liabilities and shareholders' equity:
Interest-bearing liabilities:
Savings accounts	$ 1,191,476	919	0.31%	$ 1,209,726	882	0.29%
Interest-bearing demand accounts	851,356	144	0.07%	854,600	144	0.07%
Money market accounts	1,160,520	783	0.27%	1,144,522	768	0.27%
Certificate accounts	1,690,251	5,065	1.19%	1,735,898	5,356	1.22%
Borrowed funds (f)	889,920	6,711	2.99%	864,315	6,690	3.07%
Junior subordinated debentures	103,094	1,183	4.49%	103,094	1,436	5.45%

Total interest-bearing liabilities	5,886,617	14,805	1.00%	5,912,155	15,276	1.03%

Noninterest bearing checking	808,732			794,411
Noninterest bearing liabilities	64,338			91,385

Total liabilities	6,759,687			6,797,951

Shareholders' equity	1,143,679			1,129,629

Total liabilities and shareholders' equity	$ 7,903,366			$ 7,927,580

Net interest income/ Interest rate spread		63,741	3.27%		64,233	3.28%

Net interest-earning assets/ Net interest margin	$ 1,475,238		3.46%	$ 1,462,236		3.48%

Ratio of interest-earning assets to
interest-bearing liabilities	1.25X			1.25X

(a) Average gross loans receivable includes loans held as available-for-sale and loans placed on nonaccrual status.
(b) Interest income includes accretion/ amortization of deferred loan fees/ expenses, which was not material.
(c) Average balances do not include the effect of unrealized gains or losses on securities held as available-for-sale.
(d) Interest income on tax-free investment securities and tax-free loans are presented on a fully taxable equivalent basis.
(e) Average balances include the effect of unrealized gains or losses on securities held as available-for-sale.
(f) Average balances include FHLB borrowings and securities sold under agreements to repurchase.
(g) Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 4.92% and 5.01%, respectively, Investment securities - 2.12%
and 2.16%, respectively, Interest-earning assets - 4.19% and 4.23%, respectively. GAAP basis net interest rate spreads were 3.19% and
3.20%, respectively, and GAAP basis net interest margins were 3.38% and 3.40%, respectively.