First Northwest Bancorp Q2 2026: Net Income Reaches $308K as NIM Compresses to 2.95%

summarizeSummary

First Northwest Bancorp posted Q2 2026 net income of $308,000 ($0.03 EPS), saw its net interest margin decline to 2.95%, and reported improving credit quality. Management expects profitability to improve in the second half of 2026.

check_boxKey Events · Earnings and Guidance · FNWB

• Q2 Net Income of $308K

  Net income came in at $308,000 ($0.03 per share), compared to $6,000 in Q1 2026 and $3.7 million in Q2 2025. Revenue was flat sequentially at $16.2 million.

• Net Interest Margin Compresses

  Driven by higher funding costs, the net interest margin declined to 2.95% from 3.03% in Q1 2026, though deposit costs remained flat at 2.04%.

• Credit Quality Improves

  Nonperforming assets fell to 1.05% of total assets from 1.08% in Q1 2026. A $337,000 recapture of provision for credit losses was recorded, and classified loans decreased $9.1 million to $25.5 million.

• Balance Sheet Repositioning Continues

  Customer deposits grew $11.3 million while brokered deposits declined $5.5 million. Loans decreased 1% to $1.60 billion as the bank reduces commercial real estate exposure.

auto_awesomeAnalysis · FNWB · Finance

A modest profit of $308,000 in Q2 2026 marks a sharp turnaround from the near-breakeven prior quarter, though it remains well below the $3.7M earned a year ago. The net interest margin compressed 8 basis points sequentially to 2.95% as funding costs rose, even while deposit costs held flat. Credit trends improved, with nonperforming assets declining and a $337K provision recapture. Management signaled that efficiency initiatives should begin boosting profitability in late 2026, but the path remains gradual. The stock trades near its 52-week high, suggesting the market has already priced in a recovery narrative.