First Northwest Bancorp Q2 Earnings: Net Income Drops to $308K as Costs Surge
FNWB sits 60% above its 52-week low of $6.9.
Summary
First Northwest Bancorp earned just $308,000 in Q2 2026 as surging expenses overwhelmed stable revenue. Credit trends improved, but a $106.9 million lawsuit and margin compression weigh on the outlook.
Key Events · Earnings and Guidance · FNWB
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Net Income Plunges
Q2 2026 net income fell to $308,000 ($0.03 EPS) from $3.7 million a year ago, driven by a 28.4% surge in noninterest expense.
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Expense Surge
Noninterest expense jumped to $16.4 million, with compensation up $3.4 million (due to a prior-year ERC credit) and professional fees up $856,000 on higher legal costs.
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Margin Compression
Net interest margin declined to 2.95% from 2.83% a year ago, as interest income fell faster than interest expense.
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Credit Quality Improves
Nonperforming loans decreased 8.3% to $20.7 million, and the bank recaptured $540,000 in credit loss provisions, reflecting lower loss expectations.
Analysis · FNWB · Finance
First Northwest Bancorp reported Q2 2026 net income of $308,000, a sharp decline from $3.7 million a year ago. The drop was driven by a 28% jump in noninterest expense to $16.4 million, fueled by higher compensation and legal costs tied to ongoing litigation. While credit quality improved — nonperforming loans fell 8% and the bank recaptured $540,000 in credit loss provisions — the net interest margin compressed to 2.95%. The bank faces a $106.9 million lawsuit from 3|5|2 Capital, adding legal overhang. This quarter shows a bank stabilizing credit but struggling with expense control and margin pressure.
At the time of this filing, FNWB was trading at $11.03 on NASDAQ in the Finance sector, with a market capitalization of approximately $104.7M. The 52-week trading range was $6.90 to $12.52. This filing was assessed with negative market sentiment and an importance score of 7 out of 10.