Company: BWFG
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0001505732-25-000162
Chunk: 193

Company: Bankwell Financial Group, Inc.
Filing Date: 2025-11-05
Form: 10-Q
Item: Part I, Item 2
Chunk 193
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 (basis points)September 30, 2025December 31, 2024Year 1 from Year 1 Base-100(3.20)%(1.00)%+1003.40 %0.60 %+2006.60 %0.80 %+30010.10 %1.40 %

The net interest income simulation model attempts to measure the change in net interest income over the next one-year period, and over the next two year period on a cumulative basis, assuming certain changes in the general level of interest rates. 

Based on our model, which was run as of September 30, 2025, we estimated that over the next one-year period a 200 basis-point parallel ramp increase of interest rates would increase our net interest income by 1.40%, while a 100 basis-point parallel ramp decrease of interest rates would decrease net interest income by 0.70%. As of December 31, 2024, we estimated that over the next one-year period a 200 basis-point parallel ramp increase of interest rates would decrease our net interest income by 1.00%, while a 100 basis-point parallel ramp decrease of interest rates would increase net interest income by 0.40%. Based on our model, which was run as of September 30, 2025, we estimated that over the next two years, on a cumulative basis, a 200 basis-point parallel ramp increase of interest rates would increase our net interest income by 5.50%, while a 100 basis-point parallel ramp decrease in interest rates would increase net interest income by 7.60%. As of December 31, 2024, we estimated that over the next two years, on a cumulative basis, a 200 basis-point parallel ramp increase of interest rates would decrease our net interest income by 2.90%, while a 100 basis-point parallel ramp decrease in interest rates would increase net interest income by 12.80%. The change in sensitivity between September 30, 2025 and December 31, 2024 was impacted by an increase in variable-rate loans.

We conduct an economic value of equity at risk simulation in tandem with net interest income simulations, to ascertain a longer term view of our interest rate risk position by capturing longer-term repricing risk and options risk embedded in the balance sheet. It measures the sensitivity of economic value of equity to changes in interest rates. The economic value of equity at risk simulation values only the current balance sheet and