Financial Performance - First Northwest Bancorp reported a net loss of $2.8 million for Q4 2024, compared to a net loss of $2.0 million in Q3 2024 and a net loss of $5.5 million in Q4 2023, with a basic and diluted loss per share of $0.32[2]. - The company reported a net income of $2,500 thousand for the fourth quarter of 2024, compared to $3,000 thousand in the previous quarter, indicating a decrease of 16.7%[35]. - The net loss for the quarter was $2,810,000, compared to a net income of $2,286,000 in the same quarter last year, marking a significant shift in profitability[36]. - Basic and diluted loss per common share was $(0.32) for the quarter, compared to earnings of $0.26 per share in the same quarter last year[36]. - Adjusted PPNR for the quarter was $1,204,000, while for the year ended December 31, 2024, it was $3,498,000, down from $9,555,000 in 2023[43]. Revenue and Expenses - Total revenue for Q4 2024 was $15.4 million, a decrease from $16.1 million in Q4 2023, while total noninterest expense decreased to $14.2 million[10]. - Total noninterest income for the quarter was $1,300,000, a decrease from $12,614,000 in the same quarter last year, reflecting a decline of 89.7%[36]. - Total noninterest expense for the quarter was $14,233,000, down from $16,990,000 in the same quarter last year, a reduction of 10.3%[36]. Credit Losses and Allowances - The provision for credit losses on loans was $3.8 million in Q4 2024, up from $3.1 million in Q3 2024 and $1.2 million in Q4 2023, primarily due to charge-offs of six commercial business loans[6]. - The provision for credit losses was $3.76 million for the quarter ended December 31, 2024, compared to $3.08 million in the previous quarter[18]. - The provision for credit losses for the quarter was $3,655,000, an increase from $970,000 in the same quarter last year[43]. Asset Quality and Loans - Nonperforming loans totaled $30.5 million at December 31, 2024, with the allowance for credit losses to nonperforming loans ratio decreasing to 67%[12]. - Total net loans decreased by $39.2 million, or 2.3%, to $1.68 billion at December 31, 2024, compared to $1.71 billion at September 30, 2024[18]. - Total loans amounted to $1,695,823 million as of December 31, 2024, a decrease from $1,734,807 million on September 30, 2024, representing a decline of 2.2%[38]. - Total construction and land loans decreased to $78,110 million as of December 31, 2024, from $95,709 million on September 30, 2024, representing a decline of 18.4%[38]. - Total commercial business loans decreased to $151,493 million as of December 31, 2024, down from $155,327 million on September 30, 2024, a decrease of 2.4%[38]. Deposits and Equity - Total deposits decreased by $23.6 million to $1.69 billion at December 31, 2024, compared to $1.71 billion at September 30, 2024, but increased by $11.1 million, or 0.7%, compared to $1.68 billion one year ago[19]. - Total shareholders' equity decreased to $153.9 million at December 31, 2024, compared to $160.8 million three months earlier[20]. - Shareholders' equity decreased to $153,882 thousand as of December 31, 2024, down from $160,789 thousand on September 30, 2024, representing a decline of 4.3%[34]. Interest Income and Expenses - Total interest income for the quarter ended December 31, 2024, was $28,197,000, compared to $26,309,000 for the same quarter last year, representing a year-over-year increase of 7.2%[36]. - Net interest income after provision for credit losses was $10,482,000 for the quarter ended December 31, 2024, down from $13,043,000 in the same quarter last year, a decrease of 19.6%[36]. - Interest expense on deposits increased to $11,175,000 for the quarter, up from $8,758,000 in the same quarter last year, an increase of 27.5%[36]. - The company reported a total interest expense of $14,060,000 for the quarter, compared to $12,114,000 in the same quarter last year, reflecting a year-over-year increase of 15.9%[36]. Strategic Focus and Future Plans - The company aims to improve asset quality and profitability while focusing on growing core commercial and retail customer relationships in 2025[4]. - The company plans to continue focusing on strategic partnerships to enhance its financial services offerings, including digital payments and marketplace lending[29]. - The company has been recognized for its community leadership, winning multiple awards including Best Bank and Best Lender in Clallam County[24].

Company Performance - First Northwest Bancorp (FNWB) reported a quarterly loss of $0.32 per share, significantly worse than the Zacks Consensus Estimate of $0.06, marking an earnings surprise of -633.33% [1] - The company posted revenues of $15.44 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 6.44%, compared to year-ago revenues of $11.27 million [2] - Over the last four quarters, FNWB has surpassed consensus EPS estimates only once and has topped consensus revenue estimates just once [2] Stock Movement and Outlook - FNWB shares have increased by approximately 4.9% since the beginning of the year, outperforming the S&P 500's gain of 3.2% [3] - The company's future stock performance will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.08 on revenues of $16.6 million, and for the current fiscal year, it is $0.75 on revenues of $71.8 million [7] Industry Context - The Zacks Industry Rank indicates that the Banks - West industry is currently in the top 23% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Core Points - First Northwest Bancorp reported a net loss of $2.8 million for Q4 2024, an increase from a net loss of $2.0 million in Q3 2024 and a loss of $5.5 million in Q4 2023. The loss per share was $0.32 for Q4 2024 compared to $0.23 in Q3 2024 and $0.62 in Q4 2023 [1][2][3] - The adjusted pre-tax, pre-provision net revenue (PPNR) for Q4 2024 was $1.2 million, a significant improvement from a loss of $49,000 in Q3 2024 and a loss of $327,000 in Q4 2023 [2][11] - The company declared a quarterly cash dividend of $0.07 per common share, payable on February 28, 2025 [2] Financial Performance - The provision for credit losses on loans was $3.8 million in Q4 2024, up from $3.1 million in Q3 2024 and $1.2 million in Q4 2023. This provision negatively impacted net income [8][14] - Total interest income for Q4 2024 was $28.2 million, unchanged from the previous quarter but up from $26.3 million in Q4 2023. The net interest margin increased to 2.73% from 2.70% in Q3 2024 but decreased from 2.84% in Q4 2023 [18][21] - Noninterest expense decreased in Q4 2024, primarily due to a reduction in compensation and other discretionary spending [18] Asset Quality - Nonperforming loans totaled $30.5 million at the end of Q4 2024, a slight increase from $30.4 million at the end of Q3 2024. The allowance for credit losses on loans decreased to $20.5 million, representing 1.21% of total loans [15][24] - Classified loans decreased to $42.5 million, primarily due to charge-offs on commercial business loans [16] Capital and Liquidity - Total deposits decreased by $23.6 million to $1.69 billion at the end of Q4 2024, while total shareholders' equity decreased to $153.9 million [24][26] - The company maintained a strong capital position, with Common Equity Tier 1 and Total Risk-Based Capital Ratios at 12.4% and 13.6%, respectively [26] Strategic Focus - The company aims to improve asset quality and profitability while focusing on growing core commercial and retail customer relationships [3][27] - Investment securities increased by 9.5% to $340.3 million at the end of Q4 2024, with a strategy to rebalance the securities portfolio for 2025 [21][22]

Core Points - Craig Curtis has resigned from the Boards of Directors of First Fed Bank and First Northwest Bancorp, effective December 31, 2024, after serving for 10 years and 9 years respectively [2][9] - Curtis expressed gratitude for his tenure and acknowledged the bank's significant growth, emphasizing the importance of having qualified board members who can contribute meaningfully to the company [1][2] Company Overview - First Northwest Bancorp (NASDAQ: FNWB) is a financial holding company that operates First Fed Bank, which has been serving customers since 1923 and currently has 17 locations in Washington state [11] - The bank focuses on small business and community banking, offering a full range of financial products and services, and is engaged in strategic partnerships with fintech companies to enhance digital financial solutions [11] - First Fed Bank has received multiple awards in 2023, including recognition as a Best Workplace and top Corporate Philanthropist, as well as various "Best Bank" accolades from local publications [5]

Financial Performance - Net loss attributable to the parent was $(1,980) thousand for the three months ended September 30, 2024, compared to a net income of $2,504 thousand in the same period last year, reflecting a significant downturn[11]. - Comprehensive income for the three months ended September 30, 2024, was $3,193 thousand, compared to a comprehensive loss of $(3,280) thousand in the same period last year, indicating a turnaround in comprehensive performance[13]. - The company reported a basic and diluted loss per common share of $(0.23) for the three months ended September 30, 2024, compared to earnings of $0.28 per share in the same period of 2023[11]. - The company recorded a net loss of $3.8 million for the nine months ended September 30, 2024, compared to net income of $7.8 million for the same period in 2023[204]. Income and Expenses - Net interest income after provision for credit losses decreased to $10,886 thousand for the three months ended September 30, 2024, down from $14,579 thousand for the same period in 2023, representing a decline of about 25.5%[11]. - Total interest income rose to $28,206 thousand for the three months ended September 30, 2024, compared to $25,834 thousand in the prior year, marking an increase of approximately 9.0%[11]. - Noninterest income for the three months ended September 30, 2024, was $1,779 thousand, down from $2,904 thousand in the same period of 2023, a decrease of about 38.8%[11]. - Total noninterest expense increased to $15,848 thousand for the three months ended September 30, 2024, compared to $14,376 thousand in the prior year, representing an increase of approximately 10.3%[11]. Assets and Liabilities - Total assets increased to $2,255,486 thousand as of September 30, 2024, compared to $2,201,797 thousand at December 31, 2023, reflecting a growth of approximately 2.4%[7]. - Total liabilities increased to $2,094,697 thousand as of September 30, 2024, from $2,038,457 thousand at December 31, 2023, an increase of approximately 2.8%[7]. - The total shareholders' equity at September 30, 2024, was $160,789,000, a decrease from $163,340,000 at December 31, 2023[17]. Credit Losses and Loans - Provision for credit losses on loans increased significantly to $3,077 thousand for the three months ended September 30, 2024, compared to $880 thousand for the same period in 2023, indicating a rise of over 249.9%[11]. - The allowance for credit losses on loans rose to $21,970,000 as of September 30, 2024, up from $17,510,000 at the end of 2023[55]. - Nonaccrual loans totaled $30,376,000 as of September 30, 2024, with interest income recognized on a cash basis for the three months ended September 30, 2024, being $1,000[58]. - The total loans receivable increased to $1,734,807,000 as of September 30, 2024, compared to $1,660,028,000 as of December 31, 2023, reflecting a growth of approximately 4.5%[55]. Deposits and Borrowings - Total deposits increased to $1,711.6 million as of September 30, 2024, compared to $1,676.9 million at December 31, 2023, reflecting a growth of 2.07%[88]. - The weighted-average interest rate on total deposits rose to 2.68% in September 2024 from 2.34% in December 2023[88]. - The total outstanding balance of FHLB long-term advances was $160.0 million as of September 30, 2024, with a weighted-average interest rate of 3.63%[100]. Securities and Investments - The total investment securities as of September 30, 2024, were valued at $310,860,000, down from an amortized cost of $341,011,000[49]. - The company recorded gross realized losses of $2,117,000 from the sales of available-for-sale securities for the nine months ended September 30, 2024[51]. - The total gross unrealized losses for available-for-sale securities in a loss position as of September 30, 2024, was $30,209 thousand[45]. Compensation and Equity - The company reported total compensation expense for equity incentive plans was $781,000, a decrease of 29% from $1.1 million in the same period of 2023[116]. - The number of non-vested restricted stock awards increased to 114,075 shares as of September 30, 2024, from 108,143 shares at the beginning of the quarter[116]. - The company granted 81,181 shares of restricted stock during the nine months ended September 30, 2024, compared to 96,022 shares in the same period of 2023[118]. Tax and Regulatory Matters - The effective tax rates were 25.5% for the nine months ended September 30, 2024, compared to 19.9% for the same period in 2023[103]. - The company adopted ASU 2022-02 on January 1, 2023, which introduced new reporting requirements for modifications of loans to borrowers experiencing financial difficulty[73].

Core Viewpoint - First Northwest Bancorp (FNWB) is under investigation for potential violations of federal securities laws and unlawful business practices following the disclosure of significant financial discrepancies [1][2]. Financial Performance - On October 25, 2024, FNWB announced that its second quarter 2024 financial results should no longer be relied upon due to an additional $6.6 million in charge-offs and an increased provision for credit losses, totaling a restated provision of $8.7 million [2]. - A material weakness in the Company's internal control over financial reporting was identified as of June 30, 2024 [2]. Stock Market Reaction - Following the announcement of the financial issues, FNWB's stock price decreased by $0.23 per share, or 2.2%, closing at $10.13 per share on October 28, 2024 [3].

Financial Performance - First Northwest Bancorp (FNWB) reported a quarterly loss of $0.23 per share, significantly missing the Zacks Consensus Estimate of $0.05, and down from earnings of $0.28 per share a year ago, representing an earnings surprise of -560% [1] - The company posted revenues of $15.8 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 8.15%, and down from $17.85 million in the same quarter last year [2] - Over the last four quarters, FNWB has surpassed consensus EPS estimates only once and has topped consensus revenue estimates just once [2] Stock Performance - FNWB shares have declined approximately 36.5% since the beginning of the year, contrasting with the S&P 500's gain of 22.1% [3] - The current consensus EPS estimate for the upcoming quarter is $0.21 on revenues of $17.7 million, and for the current fiscal year, it is $0.46 on revenues of $66.8 million [7] Industry Outlook - The Zacks Industry Rank indicates that the Banks - West industry is currently in the bottom 39% of over 250 Zacks industries, suggesting potential challenges for FNWB's stock performance [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact FNWB's future performance [5]

Financial Performance - First Northwest Bancorp reported a net loss of $2.2 million for Q2 2024, compared to a net income of $396,000 in Q1 2024 and $1.8 million in Q2 2023[6]. - Total revenue, net of interest expense, was $21.6 million in Q2 2024, up from $16.1 million in Q1 2024 and $17.7 million in Q2 2023[4]. - The company reported a net loss of $2,219 thousand for June 30, 2024, compared to a net income of $1,776 thousand for June 30, 2023[66]. - Net loss for the first half of 2024 was $(1,823), a decrease of 134.4% compared to the same period in 2023[59]. - Basic and diluted loss earnings per common share for Q2 2024 was $(0.25), a decline of 725.0% from Q1 2024[57]. Credit Losses and Provisions - The provision for credit losses increased to $8.7 million in Q2 2024, primarily due to loan charge-offs related to substandard lending relationships[5]. - The provision for credit losses was $8.7 million in Q2 2024, compared to $970,000 in Q1 2024 and $300,000 in Q2 2023, primarily due to charge-offs in commercial loans[14]. - Provision for credit losses on loans surged to $8,640 in Q2 2024, a dramatic increase of 597.3% from Q1 2024 and 2,780.0% year-over-year[57]. - The allowance for credit losses on loans increased to $19,300 thousand, representing 1.14% of total loans as of June 30, 2024, up from 1.05% in Q1 2024[39]. - Nonperforming loans rose to $23,631 thousand in Q2 2024, an increase of $4,150 thousand from Q1 2024, primarily due to credit concerns related to commercial construction loans[40]. Loans and Deposits - The company experienced a significant increase in non-real estate loans, which rose by 11%, approximately $41 million, year-to-date in 2024, while real estate loans remained flat[3]. - Total deposits grew by $41.7 million, or 2.5%, to $1.71 billion during the second quarter[5]. - Total net loans decreased by $15.0 million, or 0.9%, to $1.68 billion at June 30, 2024, compared to $1.69 billion at March 31, 2024, but increased by $56.9 million, or 3.5%, from $1.62 billion one year ago[29]. - Total deposits increased to $1,708,288 thousand in Q2 2024, up from $1,676,892 thousand in Q1 2024, representing a growth of 7.7% year-over-year[38]. - Consumer deposits accounted for 57% of total deposits, with an average balance of $23,000 per account[36]. Interest Income and Expenses - Total interest income for Q2 2024 was $28,611, an increase of 4.7% from Q1 2024 and 12.3% year-over-year[57]. - Total interest expense increased by $978,000 to $14.4 million in Q2 2024, up from $13.4 million in Q1 2024, and up $4.9 million from $9.5 million in Q2 2023[12]. - Total interest expense for Q2 2024 was $14,376, up 7.3% from Q1 2024 and 51.5% year-over-year[57]. - The cost of total deposits increased to 2.47% in Q2 2024, compared to 2.43% in Q1 2024, reflecting rising interest rates[38]. Noninterest Income and Expenses - Noninterest income surged to $7.4 million in Q2 2024, a 329.4% increase from $1.7 million in Q2 2023, driven by a sale-leaseback transaction[20]. - Noninterest income for Q2 2024 reached $7,347, a significant increase of 235.8% from Q1 2024 and 329.4% year-over-year[57]. - Noninterest expense totaled $15.6 million in Q2 2024, up from $14.3 million in Q1 2024 and $15.2 million in Q2 2023, mainly due to increased incentive compensation and a one-time tax assessment[22]. Shareholder Equity and Capital Ratios - Total shareholders' equity decreased to $158,900 thousand at June 30, 2024, compared to $160,500 thousand at March 31, 2024, due to a net loss of $2,200 thousand[43]. - Common Equity Tier 1 capital ratio was 12.4% as of June 30, 2024, remaining above regulatory requirements[43]. - Return on average equity for June 30, 2024, was -5.47%, compared to 4.41% for June 30, 2023[66]. - Book value per common share was $16.81, up from $16.56 a year earlier[62]. Operational Changes and Future Outlook - A reduction-in-force impacting 9% of the workforce was completed on July 24, 2024, expected to reduce compensation expenses by approximately $1.0 million per quarter starting in Q4 2024[5]. - The company anticipates potential risks including increased competitive pressures and changes in the interest rate environment affecting future performance[51]. - The Company authorized a new share repurchase plan for 944,279 shares in Q2 2024, alongside cash dividends totaling $670,000[44].

Exhibit 99.1 "In spite of challenging times for the entire industry as a result of the rate environment, First Northwest executed on a balance sheet restructure strategy. The restructure included a sale-leaseback transaction for six of our branches, a restructure of our bankowned life insurance policies, two securities loss sale transactions, two balance sheet hedges against fixed rate loans and municipal bonds and the sale of our Visa B shares," commented Matthew P. Deines, President and CEO. "As a result, ...

Company Overview - First Northwest Bancorp (Nasdaq: FNWB) is a financial holding company involved in investment activities, primarily through its subsidiary, First Fed Bank, which focuses on small businesses and has been operational since 1923 [2] - First Fed Bank operates 18 locations in Washington state, including 12 full-service branches, and aims to build sustainable earnings by offering a comprehensive range of financial products and services [2] - The company emphasizes strategic partnerships with fintech firms to enhance digital financial solutions for a broader customer base and has made minority investments in fintech companies, including Meriwether Group in 2022 [2] Board of Directors - Jennifer Zaccardo retired from the Boards of Directors of First Northwest Bancorp and First Fed Bank effective July 2, 2024, after serving 13 years on the First Fed Board and 9 years on the FNWB Board [7][10] - Zaccardo expressed pride in the achievements of the institution and confidence in its future success, highlighting the bank's recognition as a Best Workplace and top Corporate Philanthropist in 2023 [8] - The Nominating and Corporate Governance Committee is actively recruiting new board members to ensure diversity and appropriate skills for the board [4]