Company: NWBI
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0001471265-25-000077
Chunk: 149

Company: Northwest Bancshares, Inc.
Filing Date: 2025-05-06
Form: 10-Q
Item: Item 8
Chunk 149
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 are made regarding loan prepayments and decay rates of savings and interest-bearing demand accounts. Because it is difficult to accurately project the market reaction of depositors and borrowers, the effect of actual changes in interest rates on these assumptions may differ from simulated results. We have established the following guidelines for assessing interest rate risk:

Net interest income simulation. Given a parallel shift of 100 basis points (“bps”), 200 bps and 300 bps in interest rates, the estimated net income may not decrease by more than 5%, 10% and 15%, respectively, within a one-year period.

Net income simulation. Given a parallel shift of 100 bps, 200 bps and 300 bps in interest rates, the estimated net income may not decrease by more than 10%, 20% and 30%, respectively, within a one-year period.

Market value of equity simulation. The market value of equity is the present value of assets and liabilities. Given a parallel shift of 100 bps, 200 bps and 300 bps in interest rates, the market value of equity may not decrease by more than 10%, 20% and 25%, respectively, from the computed economic value at current interest rate levels.

The following table illustrates the simulated impact of a 100 bps, 200 bps or 300 bps upward or a 100 bps, 200 bps or 300 bps downward movement in interest rates on net income, return on average equity, earnings per share and market value of equity. This analysis was prepared assuming that interest-earning asset and interest-bearing liability levels at March 31, 2025 remain constant. The impact of the rate movements was computed by simulating the effect of an immediate and sustained shift in interest rates over a twelve-month period from March 31, 2025 levels.

 IncreaseDecreaseParallel shift in interest rates over the next 12 months100 bps200 bps300 bps100 bps200 bps300 bpsProjected percentage increase/(decrease) in net interest income(0.8)%(2.0)%(3.2)%(1.0 %)(5.7 %)(8.2 %)Projected percentage increase/(decrease) in net income(2.0)%(4.9)%(7.9)%(2.5 %)(14.4 %)(20.6