Continuing our evolution as a
full-service financial institution
2013 Summary Annual Report
Building loyalty, trust and value
among our employees, customers,
communities and shareholders
The Board of Directors, officers and employees of Northwest Bancshares, Inc. are pleased to
report on our company’s operations for the year ended December 31, 2013. Most significantly,
we believe 2013 marks the beginning of a period of normalization for our company as the
aftermath of the Great Recession finally appears to have ended. With that, we are pleased to
report record earnings for our company in 2013, as well as a significant increase in the market
value of our stock. The year also brought an end to our regulatory compliance challenges,
significant improvement in our operations and further enhancements to our franchise.
Message to Stockholders
Annual Earnings
Shareholder Value and Capital Deployment
repurchases unattractive. With our shares now
Net income for the year ended December 31, 2013
Northwest’s common shares increased in market
was $66.7 million, an increase of $3.2 million,
value by 21.7% in 2013, rising to $14.78 from
or 5%, over the previous year. The increase was
$12.14. This increase is consistent with the
trading in excess of 140% of tangible book value,
stock repurchases have become excessively dilutive
and such activity has been temporarily curtailed.
primarily due to a $3.7 million after-tax gain on
movement of bank stocks in general during a
Although we continue to seek opportunities to
the sale of common and preferred stocks from
year when the U.S. stock market posted robust
leverage capital by growing our balance sheet,
our investment portfolio. Although net interest
returns. Although the strength of the stock market
we spent almost the entire year under continued
income decreased measurably as a result of the
provided a significant enhancement to shareholder
regulatory restraint, which hindered our ability
continuation of low market interest rates, this loss
value, we also actively sought opportunities to
to acquire other banks. Fortunately, during
in income was offset by a significant reduction
manage capital for the benefit of our shareholders.
that time period there were very few attractive
in the provision for loan losses as asset quality
continued to improve. Also contributing to the
consistency in core earnings was a substantial
increase in the income from our trust, insurance
and other financial services lines of business, while
the increase in operating expense was controlled.
In an effort to return excess capital to our
shareholders and to provide them with a strong
dividend yield, we paid $.50 in cash dividends
during the year, which represented approximately
70% of earnings and a yield of approximately
3.50%. Unless we can uncover more viable
acquisition opportunities offered either within
our existing footprint or in contiguous markets.
We are hopeful that merger and acquisition activity
will increase in 2014, and we remain committed
to pursuing those opportunities which enhance
our franchise, increase earnings and provide lasting
shareholder value.
Earnings per share increased 8.8% to $.74 while
alternatives to leverage excess capital, we plan to
return-on-equity increased from 5.48% to 5.88%
continue to employ a strategy of paying ever-
Loan Growth and Credit Quality
and return-on-average-assets increased from .79%
increasing and aggressive dividends to limit further
to .84%. While we do not consider these earnings
accumulation of capital.
We were pleased to achieve loan growth of $104
million, or 1.8% in 2013 despite continued weak
ratios to be stellar when compared to our long-
term goals, we are pleased to realize continued
progress while being confronted with an extremely
difficult operating environment.
We also utilized stock buybacks to return excess
demand on the part of consumer and business
capital with the purchase of 368,800 shares in the
borrowers. Residential mortgage loans experienced
second quarter at an average price of $12.09 per
share. Unfortunately, the dramatic increase in the
the greatest rate of growth, increasing $83 million,
or 3.4%. In recent years, we have targeted minimal
price of our stock later in the year made further
growth in our mortgage portfolio as the rates on
2
We are pleased to report record earnings and an end to our regulatory compliance challenges.
such loans approached historic lows near three
agenda this year, and we were pleased in November
will meet current and future expectations. We
percent. With mortgage rates rising above four
to be released from the informal agreement we had
also remain cognizant of the requirements of the
percent in 2013, we chose to use excess liquidity to
executed with our federal banking regulator one
Community Reinvestment Act and our obligation
grow this portfolio in an attempt to preserve our
year earlier. Over the past three years, our Board,
to the communities we serve. In this regard, in
net interest margin.
officers and employees have been intensely focused
2013 we formed a Fair Lending Task Force to
Northwest’s commercial lenders continue to make
progress in growing market share as our expertise
and reputation in this area continues to build. To
assist with future growth requirements, we formed
a separate small business lending unit which
utilizes the resources of office managers to develop
business relationships in their markets. This will
not only leverage our local talent, but also provide
more time for our commercial lenders to pursue
larger credits.
Credit quality improved significantly during 2013,
with loans 90 days or more delinquent falling to
$58 million, or 1.0% of total loans. This is the
lowest amount and percentage of such delinquency
since April 2008, when our country was entering
the initial stages of the economic crisis.
Regulatory Compliance
on strengthening our compliance management
ensure that Northwest is being proactive in seeking
system in a quest to protect consumers and meet
lending opportunities which address the needs
the expectations of all regulatory bodies. This
process has carried a significant price tag, and
we currently estimate that this effort has added
between $3 million and $5 million of on-going
annual expense. However, we believe that this
enhanced system will not only help us avoid future
regulatory concerns, but also give Northwest a
competitive edge should smaller community banks
decide to pursue a highly-qualified merger partner.
Despite having met current regulatory
expectations, our efforts to strengthen our
compliance system have not diminished. We
of the low and moderate income borrowers who
reside in the markets we serve.
Expansion of Trust, Investment Management
and Insurance Lines
We began 2013 with the acquisition of the Bert
(Insurance) Agency in Erie, Pennsylvania. The
transition went well due to great cooperation
on the part of the former Bert employees. The
revenues provided by this group effectively
doubled our insurance income in 2013 from the
previous year. We remain enthusiastic regarding
are currently in the final stages of implementing
the revenue enhancing potential of insurance
an enhanced process to meet the increasing
products, and we plan to take advantage of future
requirements of the Bank Secrecy Act. This is a
opportunities to expand this line of business. We
challenge that even the largest banks in the country
finished the year on December 31, 2013 with the
are struggling to address. Based on our success
purchase of Evans Capital Management, which is
The enhancement of our regulatory compliance
to date, we are confident that we are creating a
also headquartered in Erie. Evans had $240 million
management system remained at the top of our
comprehensive system that is scalable and that
of assets under management or administration,
Credit quality improved significantly with 90 day delinquencies falling to 1% of total loans.
3
Message to Stockholders
which increased our combined totals to nearly
ago when the facility we were leasing was razed.
mobile banking. We view this evolution as an
$2 billion. The Evans group also had an insurance
We had significant success in the former location
opportunity to improve both customer satisfaction
division which we have integrated with our
and we look forward to similar success in this
and operational efficiency. Two major projects were
consolidated insurance group, Northwest Insurance
beautiful and vibrant Pennsylvania community.
initiated in 2013 to address changing consumer
Services, Inc. We are pleased to have the former
The second office opening was in Zelienople,
preference. First, we began upgrading all of our
Evans employees as part of the Northwest team.
Butler County, Pennsylvania, which complements
As a result of both our internal growth and the
acquisition of existing businesses, annual income
from Trust, Insurance and other financial services
grew $3.2 million, or 21%, in 2013. Continuing to
grow these sources of noninterest income remains a
strategic goal for our company.
Enhancement of Our Franchise
In recent years we have reduced the number of
de novo branch openings as bricks and mortar
seem to be diminishing in importance when
attempting to attract or retain customers.
our network of offices in the greater Pittsburgh
market. The Zelienople area is experiencing
economic and population growth as it benefits
from its proximity to the rapidly growing north
Pittsburgh suburbs.
We also sought opportunities to create efficiencies
by closing or consolidating offices. In this regard,
we consolidated our Sykesville, Pennsylvania office
with the DuBois office and closed a drive-through
facility in Oil City.
Customer Convenience
However, in 2013, we opened two new offices in
American consumers continue to transform our
geographic areas that should provide significant
industry by changing the way they choose to bank.
opportunities to serve growing markets. The first
The number of transactions taking place in our
onsite ATMs to enable them to accept either check
or cash deposits, while giving customers immediate
credit and expanded availability to these funds. This
technology is receiving wide acceptance and we are
hopeful that it will eventually enable our offices to
reduce hours of operation and staffing requirements.
Mobile banking, where customers use portable
electronic devices to make inquiries and transact
business, is anticipated to be the most significant
evolution in our industry in decades. Northwest
introduced an upgraded mobile banking app in
September 2013 and it has been enthusiastically
received by over 17,000 of our customers. As
part of this mobile offering, we will be releasing
an application in early 2014 which will allow
customers to deposit a check using their cell
opening was in downtown Hershey, Dauphin
offices continues to decrease while our customers
phone. Again, we are hopeful that this change
County, Pennsylvania, which in essence was the
increase their access through telephone banking,
in transaction preference will drive efficiencies
replacement of an office that we lost several years
online banking, direct deposit and, most recently,
in our operations.
4
Income from Trust, Insurance and other financial services grew $3.2 million or 21%.
Conclusion
In conclusion, we must reflect on the challenging
five-year period just ended during which time the
banking industry encountered the perfect storm
of credit deterioration, margin compression and
increased operational costs. The Great Recession
resulted in significant deterioration in the credit
quality of loan portfolios and pushed loan losses
to historically high levels. As the Federal Reserve
pushed interest rates to historic lows, net interest
margins were put under tremendous pressure.
Finally, the industry was hit by an onslaught of
additional costs ranging from compliance and risk
management enhancement to fraud and cyber
prevention.
We believe Northwest successfully weathered the
challenges of this five-year financial firestorm.
half of those of our peer group and were even lower
We thank you for your patience, confidence and
when compared to national averages. We were
support during a challenging period in the history
also pleased to control operating expenses despite
of our company. We will make every effort to
having to devote significantly more resources to
ensure that our shareholders are satisfied investors
regulatory oversight, risk monitoring and loss
in Northwest Bancshares, Inc.
prevention. As a result, our expense to asset ratio
increased marginally from 2.48% in 2008 to 2.61%
in 2013, a time period during which total assets
remained flat.
While we are pleased to have demonstrated such
consistency over the past five years, we recognize
that we must remain focused on achieving
acceptable annual earnings growth to enhance
shareholder value. To achieve that goal we must
take advantage of strategic opportunities to return
excess capital while growing our company both
internally and through accretive acquisitions.
We must also continue to improve our loan
Sincerely,
William J. Wagner
Chairman, President and CEO
Our average annual net interest margin remained
and deposit mix while growing our sources of
in a range between 3.50% and 3.66% from 2009
noninterest income, specifically in the areas of
to 2013, keeping that component of our annual
wealth management and insurance. Finally, we
earnings relatively consistent. While the credit
must make every effort to build more efficiencies
quality of our loan portfolio deteriorated during
into our business model, especially in the area of
that time, our actual loan losses were approximately
staffing levels and compensation expense.
We must remain focused on achieving acceptable annual earnings growth to enhance shareholder value.
5
Market Coverage
NORTHWEST SAVINGS BANK
NORTHWEST CONSUMER DISCOUNT COMPANY
Northwest Bancshares, Inc.’s
network of offices serves
communities in Pennsylvania,
New York, Ohio and Maryland.
NORTHWEST SAVINGS BANK
NORTHWEST CONSUMER DISCOUNT COMPANY
NEW YORK
NEW YORK
OHIO
PENNSYLVANIA
OHIO
PENNSYLVANIA
MARYLAND
6
MARYLAND
Financial Highlights
NORTHWEST BANCSHARES, INC. AND SUBSIDIARIES
in thousands, except per share and other data
AT yEAR END DECEmBER 31,
Total assets
Loans receivable, net
Deposits
Shareholders’ equity
Book value per share
Closing market price per share
FOR THE yEAR ENDED DECEmBER 31,
Net interest income
Net income
Diluted earnings per share
Dividends per share (1)
KEy FINANCIAl RATIOS FOR THE yEAR ENDED DECEmBER 31,
Return on average shareholders’ equity
Return on average assets
Tangible common equity
Average interest rate spread
Nonperforming assets to total assets at end of period
Net charge-offs as a percentage of average loans outstanding
Allowance for loan losses to nonperforming loans at end of period
Allowance for loan losses as a percentage of loans receivable
OTHER DATA AT DECEmBER 31,
Number of:
Community banking locations
Consumer finance offices
Full time equivalent employees
Registered shareholders(2)
(1) Includes acceleration of first quarter 2013 dividend paid on December 24, 2012
(2) Excludes shareholders who own their stock in “street name.”
2013
$7,881,475
$5,734,943
$5,668,879
$1,156,801
$12.29
$14.78
$251,876
$66,739
$0.73
$0.50
5.88%
0.84%
12.76%
3.32%
1.60%
0.38%
66.12%
1.23%
165
50
2,043
13,994
2012
$7,942,600
$5,629,261
$5,764,600
$1,128,469
$12.05
$12.14
$263,976
$63,560
$0.68
$0.60
5.48%
0.79%
12.24%
3.40%
1.86%
0.43%
60.06%
1.28%
165
52
2,042
14,486
2011
$7,957,705
$5,480,381
$5,780,325
$1,154,904
$11.85
$12.44
$267,269
$64,151
$0.64
$0.43
5.24%
0.80%
12.59%
3.39%
1.99%
0.72%
54.05%
1.28%
168
52
1,950
14,914
7
Growth & Performance
Northwest has demonstrated the ability to safely grow our balance sheet...
while increasing income commensurate with that growth...
ASSETS
in billions of dollars
$6.33
$6.45
$6.53
$6.66
$6.93
$8.03
$8.15
$7.96
$7.94
$7.88
ANNUAl NET INCOmE
in millions of dollars
$56.8
$52.4
$51.5
$49.1
$48.2
$32.7
$64.2
$63.6
$66.7
$57.5
80
70
60
50
40
30
20
10
0
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
STOCK pRICE pERFORmANCE SINCE IpO
in total return %
which the market has
rewarded in the exceptional
performance of our stock.
NWBI (+639.00%)
S&P 500 (+299.15%)
SNL U.S. Bank (+170.34%)
700
600
500
400
300
200
100
0
-100
4
9
9
1
5
9
9
1
6
9
9
1
7
9
9
1
8
9
9
1
9
9
9
1
0
0
0
2
1
0
0
2
2
0
0
2
3
0
0
2
4
0
0
2
5
0
0
2
6
0
0
2
7
0
0
2
8
0
0
2
9
0
0
2
0
1
0
2
1
1
0
2
2
1
0
2
3
1
0
2
10
8
6
4
2
0
8
Corporate Profile
NORTHWEST BANCSHARES, INC.,
Our Business Solutions offering includes
a savings and loan holding company, owns and
commercial loans, business deposit accounts,
operates Northwest Savings Bank, a Pennsylvania-
cash management services and benefits
chartered savings bank headquartered in Warren,
management services featuring personal
Pennsylvania.
attention and local decision making.
As of December 31, 2013, we held assets of $7.88
Our Personal Banking offering includes
billion and operated 165 community banking
mortgage, home equity and consumer loans,
locations and 267 Automated Teller Machines
and checking and other deposit products with a
(ATMs) throughout our markets in central,
eastern and western Pennsylvania, western
New York, eastern Ohio and Maryland.
personal touch and a complete menu of delivery
channels. We also provide comprehensive
brokerage, trust and investment management
services and personal insurance products to
Our primary business involves gathering funds
meet all of our customers’ financial needs.
from deposits and borrowings and investing
those funds in loans and investment securities.
We also operate Northwest Consumer Discount
Company, a consumer finance company that
For 117 years, we have served our communities
specializes in helping customers meet their
with an ever-expanding array of banking and
consumer credit needs. As of December 31, 2013,
investment products that meet the needs of
Northwest Consumer had loans outstanding of
both business and personal customers.
$101.0 million at 50 offices across Pennsylvania.
SOURCES OF FUNDS
Subordinated Debt
1%
Money Market
Deposit
Accounts
18%
Certificates
of Deposit
25%
Savings
Accounts
18%
Checking
Accounts
25%
Borrowed
Funds
13%
INvESTmENT OF FUNDS
Consumer Loans
3%
Commercial Loans
5%
Other Assets
8%
Home Equity
Loans
14%
Mortgage
Loans
31%
Commercial
Real Estate
Loans
20%
Cash &
Investments
19%
9
Strategic Focus
10
Northwest is positioned to be a premier
provider of financial services in all of our
markets. As displayed in the sections that
follow, we have demonstrated significant
success in delivering:
• BUSINESS SOlUTIONS including
business loans and deposits as well as
assisting businesses with their employee
benefit plans and insurance.
• pERSONAl BANKINg products and
services, including checking and
deposit accounts and loans to fill all
personal needs.
Business Solutions
NORTHWEST’S gOAl IS TO pROvIDE A
WIDE ARRAy OF FINANCIAl SOlUTIONS
TO BUSINESSES UTIlIzINg pRODUCTS AND
SERvICES THAT ARE COmpETITIvEly pRICED
AND OF THE HIgHEST qUAlITy.
We specialize in developing lasting relationships
based on custom-tailored products and services,
local decision making and personal attention.
• Business Checking
• Retirement Plans
• Merchant Services
• Commercial Lending
• Small Business Loans
• Employee Benefits
• Insurance
• Express Deposit (Remote Capture)
• Business Online Banking and Bill Pay
• Business Mobile Banking
• Business Credit Cards
11
Business Solutions
Building a strategic partnership with our business customers
lOANS
Northwest’s commercial loans have grown
substantially over the past five years...
while yields have remained at attractive levels
despite the low interest rate environment....
and loan losses have been much lower
than the industry average.
COmmERCIAl lOANS
in millions of dollars
COmmERCIAl lOAN yIElDS vS.
3-yEAR TREASURy yIElD AT DECEmBER 31
lOAN lOSSES vS. INDUSTRy AvERAgE lOSSES
as a % of loans
2,500
2,000
1,500
1,000
500
0
$1,886.0 $1,889.6
$1,695.7
$2,048.6
$2,102.8
2009
2010
2011
2012
2013
7
6
5
4
3
2
1
0
5.82%
5.73%
5.63%
5.25%
4.61%
1.70%
1.02%
0.36%
0.36%
0.78%
3.0
2.5
2.0
1.5
1.0
0.5
0.0
2.50%
2.55%
1.55%
0.51%
0.63%
0.72%
0.88%
0.43%
0.38%
1.00%
2009
2010
2011
2012
2013
2009
2010
2011
2012
2013
Northwest commercial loan yields
3-year Treasury yield
Northwest losses
Industry average losses
DEpOSITS
Balances of business deposits have also
increased substantially over the past four years...
while the average cost of such deposits
has decreased and remains very low.
COST OF BUSINESS DEpOSITS
BUSINESS DEpOSIT BAlANCES
in millions of dollars
$1,017.6
$1,073.4
$784.5
$808.6
$855.3
1,200
1,000
800
600
400
200
0
0.56%
0.28%
0.6
0.5
0.4
0.3
0.2
0.1
0.0
2009
2010
2011
2012
2013
2009
2010
2011
2012
2013
12
Northwest’s mix of business deposits is
diversified due to our focus on meeting
the needs of all types of businesses.
Interest
Checking
Accounts
16%
Municipal
Accounts
15%
Business
Money Market
Accounts
30%
0.17%
0.12%
0.14%
Non-Interest
Checking Accounts
39%
Business Solutions
RETIREmENT, INSURANCE AND INvESTmENT SERvICES
Northwest has increased assets under
administration and management in recent years...
which has driven an increase in
fee income from these business lines.
Northwest’s new insurance lines have also
provided a significant boost to fee income.
ASSETS UNDER mANAgEmENT
in millions of dollars
RETIREmENT AND INvESTmENT SERvICES REvENUE
in millions of dollars
INSURANCE REvENUE
in millions of dollars
$1,046.8
$808.9
$718.7
$651.3
1,200
1,000
800
600
$542.8
400
200
0
2009
2010
2011
2012
2013
6
5
4
3
2
1
0
$5.5
$4.0
$4.2
$4.5
$3.6
2009
2010
2011
2012
2013
7
6
5
4
3
2
1
0
$6.3
$3.3
$3.7
$2.6
2010
2011
2012
2013
ASSET mIX
as a % of total assets
RETIREmENT AND INvESTmENT SERvICES REvENUE
as a % of total revenue
INSURANCE REvENUE
as a % of total insurance revenue
Investment
Services
14%
Investment
Services
17%
Property/Casualty
19%
Retirement Services
86%
Retirement Services
83%
Employee Benefits
81%
13
Personal Banking
14
OUR COmpANy’S gOAl IS TO DElIvER
THE HIgHEST qUAlITy pERSONAl
BANKINg pRODUCTS AND SERvICES
WITH mAXImUm CONvENIENCE AND
COmpETITIvE pRICINg.
Northwest has a comprehensive array of
financial tools to satisfy our customers’
needs as they live, work and play.
• Checking, Savings and CDs
• Loans and Lines of Credit
• Mobile Banking
• Online Banking and Bill Pay
• 55,000+ Free ATMs
• eStatementsplus
• Debit and Credit Cards
• Telephone Banking
Personal Banking
DEEpENINg RElATIONSHIpS
Our strategy of increasing the
number of services per household...
and decreasing the number of
single service households...
creates meaningful customer relationships,
reduces attrition and improves
operating performance.
SERvICES pER HOUSEHOlD
# OF SINglE SERvICE HOUSEHOlDS
# OF HOUSEHOlDS
2.908
2.941
2.846
100,000
94,213
300,000
295,051
297,957
295,596 292,397
288,747
90,000
80,000
70,000
60,000
88,991
84,641
81,319
78,058
2009
2010
2011
2012
2013
275,000
250,000
225,000
200,000
2009
2010
2011
2012
2013
2.711
2.629
3.00
2.75
2.50
2.25
2.00
2009
2010
2011
2012
2013
INCREASINg CHECKINg BAlANCES
Northwest has had great success in recent
years in procuring new checking accounts...
while checking account balances have also
increased significantly...
and provided significant levels of
checking-related fee income.
# OF CHECKINg ACCOUNTS
203,354 213,359
218,420
222,427
223,139
250,000
200,000
150,000
100,000
50,000
0
CHECKINg ACCOUNT BAlANCES
in millions of dollars
$935.0
$963.6
$867.9
$725.6
$779.3
1,000
800
600
400
200
0
2009
2010
2011
2012
2013
2009
2010
2011
2012
2013
35
30
25
20
15
10
5
0
CHECKINg ACCOUNT FEES
in millions of dollars
$34.8
$31.5
$32.3
$31.5
$31.2
2009
2010
2011
2012
2013
15
Personal Banking
Building quality personal relationships emphasizing service, convenience and value
REmAININg A pREFERRED pROvIDER OF CONSUmER CREDIT
The mortgage and home equity portfolios have provided an attractive and stable yield during a period of low interest rates while losses remain
relatively low during the recent economic downturn due to our conservative lending practices and low average balances.
mORTgAgE pORTFOlIO yIElD vS.
10-yEAR TREASURy yIElD AT DECEmBER 31
Mortgage yield
10-year Treasury yield
HOmE EqUITy pORTFOlIO yIElD vS.
3-yEAR TREASURy yIElD AT DECEmBER 31
Yield on home equity loans
3-year Treasury yield
mORTgAgE & HOmE EqUITy lOANS lOSSES
as a % of total mortgages and home equities
6
5
4
3
2
1
0
5.78%
5.54%
5.27%
3.85%
3.30%
4.83%
4.53%
3.04%
1.89%
1.78%
2009
2010
2011
2012
2013
8
7
6
5
4
3
2
1
0
6.15%
5.89%
5.64%
5.27%
4.89%
1.70%
1.02%
0.36%
0.36%
0.78%
0.24%
0.24%
0.24%
0.13%
0.25
0.20
0.15
0.10
0.05
0.00
0.08%
2009
2010
2011
2012
2013
2009
2010
2011
2012
2013
CONSUmER lOANS
We continue to retain much of our consumer loan
portfolio during the recent cycle of low demand.
While losses have remained
at manageable levels...
and yields have remained attractive
during a period of low interest rates.
CONSUmER lOANS
in millions of dollars
$273.9
$255.8
$245.7
$228.4
$228.3
CONSUmER lOAN lOSSES
as a % of consumer loans
2.65%
2.20%
1.94%
1.81%
1.64%
2.5
2.0
1.5
1.0
0.5
0.0
2009
2010
2011
2012
2013
2009
2010
2011
2012
2013
12
10
8
6
4
2
0
yIElD ON CONSUmER lOANS vS.
3-yEAR TREASURy yIElD AT DECEmBER 31
11.30%
11.57%
11.98%
11.62%
10.60%
1.70%
1.02%
0.36%
0.36%
0.78%
2009
2010
2011
2012
2013
Yield on consumer loans
3-year Treasury yield
300
250
200
150
100
50
0
16
Investment Management and Insurance
NORTHWEST IS DEDICATED TO TURNINg
OUR CUSTOmERS’ FINANCIAl SUCCESS INTO
FINANCIAl SECURITy.
Since 1999, Northwest has developed a broad range
of financial services designed to meet the banking,
investment, insurance and financial needs of its clients.
This has allowed us to achieve significant growth in
both personal assets under management and number
of clients as we leverage the opportunities to develop
such relationships with bank customers.
• Investment Advisory
• Financial Planning and Management
• Trust and Estate Services
• Brokerage
• Retirement Accounts
• Oil and Gas Lease Royalty Management
• Education Savings
• Annuities
• Life Insurance
• Long Term Care Insurance
17
Investment Management and Insurance
Assets under management have
grown significantly in recent years...
as we have had success with
customer acquisition...
leading to a growing source
of fee income.
pERSONAl ASSETS UNDER mANAgEmENT
in millions of dollars
# OF ClIENTS
INvESTmENT mANAgEmENT AND INSURANCE REvENUE
in millions of dollars
$703
$706
$639
$558
$508
800
600
400
200
0
12,000
10,000
8,000
6,000
4,000
2,000
0
10,496
8,607
7,714
7,526
7,787
2009
2010
2011
2012
2013
2009
2010
2011
2012
2013
pERSONAl ASSET mIX
as a % of total assets under management
Brokerage
33%
Trust
50%
Investment
Advisory
17%
pERSONAl ClIENT mIX
as a % of total clients
Investment Advisory
13%
Trust
9%
Insurance
27%
Brokerage
51%
6
5
4
3
2
1
0
$5.5
$4.6
$4.7
$3.5
$3.0
2009
2010
2011
2012
2013
pERSONAl REvENUE mIX
as a % of total Investment Management revenue
Insurance
8%
Brokerage
21%
Investment
Advisory
20%
Trust
51%
18
Financial Data and Investor Information
19
Financial Data
CONDENSED CONSOlIDATED BAlANCE SHEET
(in thousands, except share data)
ASSETS
Cash and cash equivalents
Marketable securities available-for-sale
Marketable securities held-to-maturity
Loans receivable, net of allowance for loan losses of $73,219 and $71,138
Accrued interest receivable
Real estate owned, net
Bank-owned life insurance
Premises and equipment
Goodwill and other intangible assets
Federal Home Loan Bank stock, at cost
Other assets
TOTAl ASSETS
lIABIlITIES AND SHAREHOlDERS’ EqUITy
Deposits
Borrowed funds
Advances by borrowers for taxes and insurance
Accrued interest payable
Other liabilities
Trust preferred securities
TOTAl lIABIlITIES
Preferred stock, $0.01 par value, 50,000,000 shares authorized; no shares issued
Common stock, $0.01 par value, 500,000,000 shares authorized; 94,243,713 and 93,652,960
shares issued and outstanding, respectively
Paid-in capital
Retained earnings
Unallocated common stock of Employee Stock Ownership Plan
Accumulated other comprehensive loss, net
TOTAl SHAREHOlDERS’ EqUITy
TOTAl lIABIlITIES AND SHAREHOlDERS’ EqUITy
AS OF DECEmBER 31,
2013
2012
$
391,905
1,016,767
121,366
5,734,943
21,821
18,203
140,172
146,139
176,782
43,715
69,662
$ 7,881,475
$ 5,668,879
881,645
26,669
888
43,499
103,094
6,724,674
—
943
619,678
571,164
(23,083)
(11,901)
1,156,801
$ 7,881,475
$
451,704
1,079,074
155,081
5,629,261
23,313
26,165
137,044
138,824
177,990
46,834
77,310
$ 7,942,600
$ 5,764,600
860,047
23,325
888
62,177
103,094
6,814,131
—
937
613,249
550,296
(24,525)
(11,488)
1,128,469
$ 7,942,600
20
CONDENSED CONSOlIDATED STATEmENTS OF INCOmE
(in thousands, except share data)
INTEREST INCOmE:
Loans
Investments and interest-earning cash
TOTAl INTEREST INCOmE
INTEREST EXpENSE:
Deposits
Borrowed funds
TOTAl INTEREST EXpENSE
Net interest income
Provision for loan losses
Net interest income after provision for loan losses
NONINTEREST INCOmE:
Service charges and fees
Trust and other financial services income
Gain/(loss) on securities
Insurance commission income
Income from bank-owned life insurance
Other
TOTAl NONINTEREST INCOmE
NONINTEREST EXpENSE:
Compensation and employee benefits
Premises and occupancy costs
Office operations
Processing expenses
Amortization of intangibles
Marketing expenses
Federal deposit insurance premiums
Other
TOTAl NONINTEREST EXpENSE
Income before income taxes
Income tax expense
NET INCOmE
Basic earnings per share
Diluted earnings per share
yEARS ENDED DECEmBER 31,
2013
2012
2011
$
287,289
25,749
313,038
$
308,254
29,784
338,038
$
320,100
39,128
359,228
29,279
31,883
61,162
251,876
18,519
233,357
35,884
9,330
5,405
8,635
5,197
2,396
66,847
112,190
23,182
14,454
25,548
1,210
6,284
5,600
18,666
207,134
93,070
26,331
66,739
0.74
0.73
$
$
$
43,377
31,822
75,199
262,839
26,338
236,501
35,623
8,544
323
6,264
4,961
3,189
58,904
111,727
22,409
13,224
25,000
1,012
7,829
5,554
18,722
205,477
89,928
26,368
63,560
0.68
0.68
$
$
$
60,721
32,080
92,801
266,427
34,170
232,257
36,220
8,125
(579)
6,548
6,019
2,645
58,978
106,595
23,055
12,850
23,332
1,819
9,953
7,101
15,522
200,227
91,008
26,857
64,151
0.64
0.64
$
$
$
21
Directors and Offi cers
Board of Directors
Northwest Bancshares, Inc.
and Northwest Savings Bank
William J. Wagner
Chairman, President and
Chief Executive Offi cer
Northwest Bancshares, Inc.
John M. Bauer
Co-Chairman,
Contact Technologies, Inc.
Richard L. Carr
Retired Superintendent,
Titusville Area School District
Deborah J. Chadsey
Attorney and Partner,
Kavinoky Cook LLP
Timothy B. Fannin
Partner,
Catalano, Case, Catalano
& Fannin
Dr. A. Paul King
Retired President,
Oral Surgery of Erie
Joseph F. Long
Retired Partner, KPMG LLP
Treasurer, Passavant
Hospital Foundation
Dr. Richard E. McDowell
President Emeritus,
Th e University of Pittsburgh
at Bradford
William F. McKnight
Controller,
Interstate Chemical Company
John P. Meegan
Executive Vice President and
Chief Operating Offi cer,
Hefren-Tillotson, Inc.
Sonia M. Probst
Retired Chief Executive Offi cer,
Rouse Estate
Philip M. Tredway
President and
Chief Executive Offi cer,
Erie Molded Plastics, Inc.
Corporate Offi cers
Northwest Bancshares, Inc.
and Northwest Savings Bank
William J. Wagner
President and
Chief Executive
Offi cer
Steven G. Fisher
Executive Vice President,
Banking Services
William W. Harvey, Jr.
Executive Vice President,
Finance and
Chief Financial Offi cer
Timothy A. Huber
Executive Vice President,
Chief Lending Offi cer
Gregory C. LaRocca
Executive Vice President,
Wealth Management,
Trust & Insurance Services
and Corporate Secretary
Julia W. McTavish
Executive Vice President,
Chief Human Resources Offi cer
Michael G. Smelko
Executive Vice President,
Chief Credit Offi cer
Ronald B. Andzelik
Senior Vice President,
Compliance and Community
Reinvestment Act Offi cer
Robert Bablak, Jr.
Senior Vice President,
Community Banking
John K. Beard
Senior Vice President,
Retail Investment Services
Douglas H. Bert
Senior Vice President,
Senior Executive,
Insurance Services
Don J. Boetger
Senior Vice President,
Senior Executive,
Retirement Services
William M. Guthrie
Senior Vice President,
Senior Executive,
Wealth Management
John E. Hall
Senior Vice President,
Consumer Lending
Neil R. Hoffman
Senior Vice President,
Commercial Lending
Richard K. Laws
Senior Vice President,
Chief Legal Counsel and
CMS Enterprise
Oversight Offi cer
Dorothy E. Lobdell
Senior Vice President,
Mortgage Lending
Gerald J. Ritzert
Senior Vice President,
Finance and Controller
Vicki L. Stec
Senior Vice President,
Compliance and
Bank Secrecy Offi cer
Thomas J. Townsend
Senior Vice President,
Chief Risk Offi cer
David E. Westerburg
Senior Vice President,
Marketing and Operations,
Chief Marketing Offi cer
Andrew C. Young
Senior Vice President,
Chief Information Offi cer
Stephen M. Bell
Vice President,
Facilities
Thomas K. Creal
Vice President,
Credit Administration
Michael R. DelPrince
Vice President,
Finance
Barbara L. DeMontier
Vice President,
Human Resources
Michael A. Doherty
Vice President,
Credit Administration
W. Norman Ewing
Vice President,
Systems and Programming
Dean C. Huya
Vice President,
Loss Mitigation
Paul C. Lindberg
Vice President,
Loan Review
Edward A. Martone
Vice President,
Human Resources
Kevin G. Mizak
Vice President,
Chief Auditor
Donald E. Reed
Vice President,
Finance and Treasurer
Melody Schott
Vice President,
Delivery Channels
David C. Stevenson
Vice President,
Computer Operations
Eric D. Stoever
Vice President,
Chief Technology Offi cer
James M. Swanson
Vice President,
Deposit Operations
William C. Tarpenning
Vice President,
Mortgage Banking
Deborah A. Vecellio
Vice President,
Mortgage Servicing
Shawn O. Walker
Vice President,
Marketing
Region Presidents
Northwest Savings Bank
Robert Bablak, Jr
Maryland
Nancy J. May
Eastern Pennsylvania
Julie A. Marasco
Northwest Pennsylvania, Ohio
Christopher A. Martin
Southwest Pennsylvania
James E. Martin
Erie, Pennsylvania
Jonathan E. Rockey
Central Pennsylvania
Jonathan P. Scalise
New York
22
Investor Information
Corporate Headquarters:
Online Shareholder Access:
Common Stock Information:
100 Liberty Street
P.O. Box 128
Warren, Pennsylvania 16365
Telephone : (814) 726-2140
Fax : (814) 728-7716
www.northwestsavingsbank.com
Annual meeting:
April 16, 2014, 11:00 a.m.
The Struthers Library Theatre
302 West Third Avenue
Warren, Pennsylvania 16365
Stock listing:
Northwest Bancshares, Inc. common stock
is traded on the NASDAQ Global Select
Market under the symbol “NWBI.”
Stock Transfer, Registrar and
Dividend Disbursing Agent:
Shareholder communications regarding
change of address, change in registration
of certificates, reporting of lost certificates
and dividend checks should be directed to:
American Stock Transfer and Trust
Company, LLC
6201 15th Avenue
Brooklyn, New York 11219
Toll Free : (800) 937-5449
Toll Free : (877) 777-0800
Fax : (718) 236-2641
Email : info@amstock.com
Web Site : www.amstock.com
Registered shareholders can access their
account(s) online through American Stock
Transfer & Trust Company, LLC at
www.amstock.com. Here you can easily
initiate a number of transactions and
inquiries, as well as obtain important
details about your holdings and general
stock transfer information.
• Update your mailing address
• Access account information
• Print a duplicate 1099 tax form
• Combine/consolidate accounts
• Request a replacement
dividend check
• Download stock transfer
instructions and forms
• Enroll in direct deposit of
dividends
Financial Information:
The Annual Report on Form 10-K is
filed with the Securities and Exchange
Commission (SEC). Copies of this
document and other filings, including
exhibits thereto, may be obtained
electronically at the SEC home page at
www.sec.gov or through the Company’s
website www.northwestsavingsbank.com.
Copies may also be obtained, without
charge, upon request by writing to the
Company’s corporate headquarters.
Independent Auditors:
KPMG LLP
Pittsburgh, Pennsylvania
Securities Counsel:
Luse Gorman Pomerenk & Schick, P.C.
Washington, D.C.
Year Ended December 31, 2013 High
$12.95
First quarter
13.58
Second quarter
14.57
Third quarter
15.05
Fourth quarter
Year Ended December 31, 2012
First quarter
Second quarter
Third quarter
Fourth quarter
High
$13.08
13.00
12.70
12.50
Low
$12.04
11.98
12.88
13.15
Low
$12.14
11.03
11.22
11.11
Cash Dividends Declared
$ 0.00
0.24
0.13
0.13
Cash Dividends Declared
$ 0.12
0.12
0.12
0.24 (1)
(1) Includes acceleration of first quarter 2013 dividend paid on December 24, 2013
Dividend Reinvestment &
Direct Stock purchase and Sale plan:
Northwest Bancshares, Inc. is pleased
to offer a Dividend Reinvestment
and Direct Stock Purchase and Sale
Plan through American Stock
Transfer & Trust Company, LLC
(the “Plan Administrator”).
The plan provides both existing
registered shareholders and interested
new investors with a convenient method
to purchase shares of Northwest
Bancshares, Inc. common stock.
If you are already a registered share-
holder or are interested in becoming
one, you may access the plan material
and enroll online at www.amstock.com
by clicking on “Invest Online” under
“Shareholder Services” or from
our investor relations website at
www.northwestsavingsbank.com.
Alternatively, you may request a
plan prospectus and enrollment
application by calling American Stock
Transfer & Trust Company, toll-free, at
(877) 715-0499 or Northwest, toll-free,
at (800) 859-1000 or (814) 728-7263.
Direct Deposit of Dividends:
Shareholders who do not reinvest
their dividends may elect to have cash
dividends directly deposited into their
savings or checking account, thereby
providing immediate access to funds
and eliminating mail delays and lost or
stolen checks. You may enroll online by
accessing your shareholder account(s)
at www.amstock.com or, to obtain
an enrollment card, by calling the
Company’s transfer agent, toll-free, at
(800) 937-5449 or Northwest, toll-free,
at (800) 859-1000.
Investor Relations:
William J. Wagner
President and Chief Executive Officer
William W. Harvey, Jr.
Executive Vice President and
Chief Financial Officer
Shareholder Relations:
Ian R. Scott
Assistant Vice President,
Shareholder Relations and
Assistant Corporate Secretary
(800) 859-1000
23
Notes
In addition to historical information, this report may contain certain forward-looking statements that are based on assumptions and information currently available to
management, including assumptions as to changes in market interest rates. These forward-looking statements are subject to various risks and uncertainties including, but
not limited to, economic, regulatory, competitive, legislative and other factors affecting the company and its operations. Readers are cautioned not to place undue reliance on
these forward-looking statements, as actual results may differ materially from those expressed or implied. Management has no obligation to revise or update these forward-
looking statements to reflect events or circumstances that arise after the release of this report. ©2014 Northwest Bancshares, Inc.
24
100 Liberty Street
PO Box 128
Warren, Pennsylvania 16365
(814) 726-2140
www.northwestsavingsbank.com