First Western Reports First Quarter 2025 Financial Results
First Quarter 2025 Summary
- Net income available to common shareholders of $4.2 million in Q1 2025, compared to $2.7 million in Q4 2024
- Diluted earnings per share of $0.43 in Q1 2025, compared to $0.28 in Q4 2024
- Net interest income of $17.5 million in Q1 2025, compared to $16.9 million in Q4 2024
- Net interest margin increased 16 basis points from 2.45% in Q4 2024 to 2.61% in Q1 2025
- Other real estate owned ("OREO") decreased $31.5 million from $35.9 million in Q4 2024 to $4.4 million in Q1 2025 due to the sale of two properties for a net gain of $0.5 million
- Noninterest-bearing deposits increased 9.1% from $375.6 million as of Q4 2024 to $409.7 million as of Q1 2025
/EIN News/ -- DENVER, April 24, 2025 (GLOBE NEWSWIRE) -- First Western Financial, Inc. (“First Western” or the “Company”) (NASDAQ: MYFW), today reported financial results for the first quarter ended March 31, 2025.
Net income available to common shareholders was $4.2 million, or $0.43 per diluted share, for the first quarter of 2025. This compares to net income of $2.7 million, or $0.28 per diluted share, for the fourth quarter of 2024, and net income of $2.5 million, or $0.26 per diluted share, for the first quarter of 2024.
Scott C. Wylie, CEO of First Western, commented, “As expected, we generated a significant improvement in our level of profitability in the first quarter. We saw positive trends in many areas including an expansion in our net interest margin, a higher level of non-interest income, an increase in noninterest-bearing deposits, solid loan production, and well managed expenses. We also saw general stability in asset quality while having a substantial reduction in our nonperforming assets following the successful resolution of our two largest OREO properties, which were sold for a net gain.
“We expect to see a continuation of the positive trends we are seeing, while we also redeploy the cash from the sale of our two largest OREO properties into interest-earning assets. We believe this will continue to result in solid financial performance for our shareholders as we move through the year,” said Mr. Wylie.
| For the Three Months Ended | |||||||||||
| March 31, | December 31, | March 31, | |||||||||
| (Dollars in thousands, except per share data) | 2025 | 2024 | 2024 | ||||||||
| Earnings Summary | |||||||||||
| Net interest income | $ | 17,453 | $ | 16,908 | $ | 16,070 | |||||
| Less: Provision (release) for credit losses | 80 | (974 | ) | 72 | |||||||
| Total non-interest income | 7,345 | 6,459 | 7,277 | ||||||||
| Total non-interest expense | 19,361 | 20,427 | 19,696 | ||||||||
| Income before income taxes | 5,357 | 3,914 | 3,579 | ||||||||
| Income tax expense | 1,172 | 1,166 | 1,064 | ||||||||
| Net income available to common shareholders | 4,185 | 2,748 | 2,515 | ||||||||
| Basic earnings per common share | 0.43 | 0.28 | 0.26 | ||||||||
| Diluted earnings per common share | 0.43 | 0.28 | 0.26 | ||||||||
| Return on average assets (annualized) | 0.59 | % | 0.38 | % | 0.35 | % | |||||
| Return on average shareholders' equity (annualized) | 6.63 | 4.39 | 4.10 | ||||||||
| Return on tangible common equity (annualized)(1) | 7.44 | 4.98 | 4.71 | ||||||||
| Net interest margin | 2.61 | 2.45 | 2.34 | ||||||||
| Efficiency ratio(1) | 79.16 | 80.74 | 83.68 | ||||||||
_____________________
| (1) | Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP Financial Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure. |
Operating Results for the First Quarter 2025
Revenue
Total income before non-interest expense was $24.7 million for the first quarter of 2025, compared to $24.3 million for the fourth quarter of 2024. Gross revenue(1) was $24.6 million for the first quarter of 2025, compared to $23.8 million for the fourth quarter of 2024. Relative to the fourth quarter of 2024, the increase in total income before non-interest expense was primarily driven by increases in Net interest income, Net gain on mortgage loans, Net gain on other real estate owned, and Net gain on loans held for sale, partially offset by an increase in provision for credit losses and a decrease in Risk management and insurance fees. Relative to the first quarter of 2024, total income before non-interest expense increased 6.0% from $23.3 million and Gross revenue increased 4.7% from $23.5 million. Relative to the first quarter of 2024, the increase in total income before non-interest expense was primarily driven by increases in Net interest income and Net gain on other real estate owned, partially offset by decreases in Bank fees and Trust and investment management fees.
| (1) | Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP Financial Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure. |
Net Interest Income
Net interest income for the first quarter of 2025 was $17.5 million, an increase of 3.6% from $16.9 million in the fourth quarter of 2024. The increase quarter over quarter was primarily driven by a 16 basis point increase in net interest margin, offset partially by a decline in average interest-earning assets. Relative to the first quarter of 2024, net interest income increased 8.7% from $16.1 million. The increase compared to the first quarter of 2024 was primarily driven by an 27 basis point increase in net interest margin, offset partially by a decline in average interest-earning assets.
Net Interest Margin
Net interest margin for the first quarter of 2025 increased 16 basis points to 2.61% from 2.45% reported in the fourth quarter of 2024, primarily due to a decrease in cost of deposits and increase in interest-earning assets yield.
The yield on interest-earning assets increased 4 basis points to 5.57% from 5.53% reported in the fourth quarter of 2024 and the cost of interest-bearing deposits decreased 19 basis points to 3.59% from 3.78% reported in the fourth quarter of 2024.
Relative to the first quarter of 2024, net interest margin increased 27 basis points from 2.34%, primarily due to a 32 basis point decrease in total cost of funds.
Non-interest Income
Non-interest income for the first quarter of 2025 was $7.3 million, an increase of 12.3% from $6.5 million in the fourth quarter of 2024. The increase was driven primarily by increases in Net gain on other real estate owned, Net gain on mortgage loans, and Net gain on loans held for sale, partially offset by a decrease in Risk management and insurance fees. The increase in Net gain on other real estate was due to the sale of our two largest OREO properties for a net gain of $0.5 million. The increase in Net gain on loans held for sale was due to the reversal of the previous quarter's write-down on a non-performing loan. This loan was previously classified as held for sale; however, during the quarter it was transferred to held for investment and charged off through the Allowance for credit losses.
Relative to the first quarter of 2024, non-interest income increased slightly, driven primarily by increases in Net gain on other real estate owned and Net gain on loans accounted for under the fair value option, offset partially by decreases in Trust and investment management fees and Bank fees.
Non-interest Expense
Non-interest expense for the first quarter of 2025 was $19.4 million, a decrease of 4.9% from $20.4 million in the fourth quarter of 2024. The decrease was primarily driven by the one-time $1.1 million Other real estate owned ("OREO") write-down recognized in the fourth quarter of 2024, offset partially by an increase in Salaries and employee benefits.
Relative to the first quarter of 2024, non-interest expense decreased 1.5% from $19.7 million, driven primarily by a decrease in Professional services due to decreases in legal expenses, audit fees, and FDIC insurance fees, partially offset by increases in Occupancy and equipment expenses and Salaries and employee benefits.
The Company’s efficiency ratio(1) was 79.2% in the first quarter of 2025, compared with 80.7% in the fourth quarter of 2024 and 83.7% in the first quarter of 2024.
| (1) | Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP Financial Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure. |
Income Taxes
The Company recorded Income tax expense of $1.2 million for the first quarter of 2025, compared to Income tax expense of $1.2 million for the fourth quarter of 2024 and Income tax expense of $1.1 million for the first quarter of 2024.
Loans
Total loans held for investment of $2.43 billion as of March 31, 2025 was flat compared to December 31, 2024. Changes in the quarter included net growth in the commercial real estate and 1 - 4 family residential portfolios, offset by net decreases in the cash, securities, and other and construction and development portfolios. Total average loans were $2.41 billion for the first quarter of 2025, an increase of $21.4 million from $2.39 billion for the fourth quarter of 2024. Relative to the first quarter of 2024, total loans held for investment decreased from $2.48 billion as of March 31, 2024, primarily driven by net decreases in the commercial and industrial, construction and development, and cash, securities, and other portfolios, partially offset by net growth in the 1 - 4 family residential and non-owner occupied commercial real estate portfolios.
Deposits
Total deposits were $2.52 billion as of March 31, 2025, an increase of 0.4% from $2.51 billion as of December 31, 2024. Relative to the first quarter of 2024, total deposits decreased from $2.53 billion as of March 31, 2024, driven primarily by a decrease in Noninterest-bearing deposits.
Borrowings
Federal Home Loan Bank (“FHLB”) and Federal Reserve borrowings were a combined $51.6 million as of March 31, 2025, a decrease of $5.4 million from $57.0 million as of December 31, 2024. The change when compared to December 31, 2024 was primarily driven by net pay downs on the Company's FHLB line of credit. Relative to the first quarter of 2024, borrowings decreased $17.9 million from $69.5 million as of March 31, 2024. The decrease in borrowings from March 31, 2024 was primarily driven by BTFP payoffs and net pay downs on the Company's FHLB line of credit.
Subordinated notes were $44.6 million as of March 31, 2025, compared to $52.6 million as of December 31, 2024. Subordinated notes decreased $7.8 million from $52.4 million as of March 31, 2024. Relative to the fourth quarter of 2024 and first quarter of 2024, the decrease was due to the call of $8.0 million of subordinated notes that became eligible to call in the first quarter of 2025.
Assets Under Management
Assets Under Management (“AUM”) decreased to $7.18 billion as of March 31, 2025, compared to $7.32 billion as of December 31, 2024. The decrease in AUM during the quarter was primarily attributable to net withdrawals throughout the first quarter of 2025. Compared to March 31, 2024, total AUM increased slightly from $7.14 billion.
Credit Quality
Non-performing assets totaled $17.1 million, or 0.59% of total assets, as of March 31, 2025, compared to $49.0 million, or 1.68% of total assets, as of December 31, 2024. The decrease in non-performing assets during the quarter was primarily due to the sale of two OREO properties for a net gain of $0.5 million. As of March 31, 2024, non-performing assets totaled $46.0 million, or 1.57% of total assets. Relative to the first quarter of 2024, the decrease in non-performing assets was primarily driven by the sale of two OREO properties, partially offset by additions to non-performing loans. OREO totaled $4.4 million as of March 31, 2025 a decrease of $31.5 million from $35.9 million as of December 31, 2024. As of March 31, 2024, the Company held no OREO.
Non-performing loans totaled $12.8 million as of March 31, 2025, a decrease of $0.3 million from $13.1 million as of December 31, 2024. The decrease was primarily due to the charge-off of a non-performing loan that had previously been held for sale. As of March 31, 2024, non-performing loans totaled $46.0 million. The decrease when compared to March 31, 2024 was driven by the migration of one loan relationship out of non-performing loans and into OREO, partially offset by additions to non-performing loans.
During the first quarter of 2025, the Company recorded provision expense of $0.1 million, compared to a provision release of $1.0 million in the fourth quarter of 2024 and provision expense of $0.1 million in the first quarter of 2024.
Capital
As of March 31, 2025, First Western (“Consolidated”) and First Western Trust Bank (“Bank”) exceeded the minimum capital levels required by their respective regulators. As of March 31, 2025, the Bank was classified as “well capitalized,” as summarized in the following table:
| March 31, | ||
| 2025 | ||
| Consolidated Capital | ||
| Tier 1 capital to risk-weighted assets | 10.35 | % |
| Common Equity Tier 1 ("CET1") to risk-weighted assets | 10.35 | |
| Total capital to risk-weighted assets | 13.15 | |
| Tier 1 capital to average assets | 8.12 | |
| Bank Capital | ||
| Tier 1 capital to risk-weighted assets | 11.76 | % |
| CET1 to risk-weighted assets | 11.76 | |
| Total capital to risk-weighted assets | 12.52 | |
| Tier 1 capital to average assets | 9.24 | |
Book value per common share increased 1.3% from $26.10 as of December 31, 2024 to $26.44 as of March 31, 2025. Book value per common share increase 3.6% from $25.52 as of March 31, 2024.
Tangible book value per common share(1) increased 1.6% from $22.83 as of December 31, 2024, to $23.18 as of March 31, 2025. Tangible book value per common share increased 4.4% from $22.21 as of March 31, 2024.
| (1) | Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP Financial Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure. |
Conference Call, Webcast and Slide Presentation
The Company will host a conference call and webcast at 10:00 a.m. MT/ 12:00 p.m. ET on Friday, April 25, 2025. Telephone access: https://register-conf.media-server.com/register/BI019349e043a94dc394d0159a3c41719d.
A slide presentation relating to the first quarter 2025 results will be accessible prior to the scheduled conference call. The slide presentation and webcast of the conference call can be accessed on the Events and Presentations page of the Company’s investor relations website at https://myfw.gcs-web.com.
About First Western
First Western is a financial services holding company headquartered in Denver, Colorado, with operations in Colorado, Arizona, Wyoming, California, and Montana. First Western and its subsidiaries provide a fully integrated suite of wealth management services on a private trust bank platform, which includes a comprehensive selection of deposit, loan, trust, wealth planning and investment management products and services. First Western’s common stock is traded on the Nasdaq Global Select Market under the symbol “MYFW.” For more information, please visit www.myfw.com.
Non-GAAP Financial Measures
Some of the financial measures included in this press release are not measures of financial performance recognized in accordance with generally accepted accounting principles in the United States (“GAAP”). These non-GAAP financial measures include “Tangible Common Equity,” “Tangible Common Book Value per Share,” “Return on Tangible Common Equity,” “Efficiency Ratio,” “Gross Revenue,” and “Allowance for Credit Losses to Adjusted Loans". The Company believes these non-GAAP financial measures provide both management and investors a more complete understanding of the Company’s financial position and performance. These non-GAAP financial measures are supplemental and are not a substitute for any analysis based on GAAP financial measures. Not all companies use the same calculation of these measures; therefore, this presentation may not be comparable to other similarly titled measures as presented by other companies. Reconciliation of non-GAAP financial measures to GAAP financial measures are provided at the end of this press release.
Forward-Looking Statements
Statements in this news release regarding our expectations and beliefs about our future financial performance and financial condition, as well as trends in our business and markets are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements often include words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” “project,” “position,” “outlook,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “opportunity,” “could,” or “may.” The forward-looking statements in this news release are based on current information and on assumptions that we make about future events and circumstances that are subject to a number of risks and uncertainties that are often difficult to predict and beyond our control. As a result of those risks and uncertainties, our actual financial results in the future could differ, possibly materially, from those expressed in or implied by the forward-looking statements contained in this news release and could cause us to make changes to our future plans. Those risks and uncertainties include, without limitation, the lack of soundness of other financial institutions or financial market utilities may adversely affect the Company; the Company’s ability to engage in routine funding and other transactions could be adversely affected by the actions and commercial soundness of other financial institutions; financial institutions are interrelated because of trading, clearing, counterparty or other relationships; defaults by, or even rumors or questions about, one or more financial institutions or financial market utilities, or the financial services industry generally, may lead to market-wide liquidity problems and losses of client, creditor and counterparty confidence and could lead to losses or defaults by other financial institutions, or the Company; integration risks and projected cost savings in connection with acquisitions; the risk of geographic concentration in Colorado, Arizona, Wyoming, California, and Montana; the risk of changes in the economy affecting real estate values and liquidity; the risk in our ability to continue to originate residential real estate loans and sell such loans; risks specific to commercial loans and borrowers; the risk of claims and litigation pertaining to our fiduciary responsibilities; the risk of competition for investment managers and professionals; the risk of fluctuation in the value of our debt securities; the risk of changes in interest rates; the risk of the adequacy of our allowance for credit losses; the risk in our ability to maintain a strong core deposit base or other low-cost funding sources; the risk of weak economic conditions and global trade, including the imposition of tariffs; the risk that legislative or regulatory actions may have a significant adverse effect on our operations. Additional information regarding these and other risks and uncertainties to which our business and future financial performance are subject is contained in our Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”) on March 7, 2025 (“Form 10-K”), and other documents we file with the SEC from time to time. We urge readers of this news release to review the “Risk Factors” section our Form 10-K and any updates to those risk factors set forth in our subsequent Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and our other filings with the SEC. Also, our actual financial results in the future may differ from those currently expected due to additional risks and uncertainties of which we are not currently aware or which we do not currently view as, but in the future may become, material to our business or operating results. Due to these and other possible uncertainties and risks, readers are cautioned not to place undue reliance on the forward-looking statements contained in this news release, which speak only as of today’s date, or to make predictions based solely on historical financial performance. Any forward-looking statement speaks only as of the date on which it is made, and we do not undertake any obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.
Contacts:
Financial Profiles, Inc.
Tony Rossi
310-622-8221
MYFW@finprofiles.com
IR@myfw.com
|
First Western Financial, Inc. Condensed Consolidated Statements of Income (unaudited) | ||||||||||
| Three Months Ended | ||||||||||
| March 31, | December 31, | March 31, | ||||||||
| (dollars in thousands, except per share amounts) | 2025 | 2024 | 2024 | |||||||
| Interest and dividend income: | ||||||||||
| Loans, including fees | $ | 34,068 | $ | 34,287 | $ | 35,139 | ||||
| Loans accounted for under the fair value option | 111 | 118 | 209 | |||||||
| Investment securities | 681 | 696 | 603 | |||||||
| Interest-bearing deposits in other financial institutions | 2,221 | 2,879 | 2,352 | |||||||
| Dividends, restricted stock | 128 | 129 | 95 | |||||||
| Total interest and dividend income | 37,209 | 38,109 | 38,398 | |||||||
| Interest expense: | ||||||||||
| Deposits | 18,516 | 19,921 | 20,622 | |||||||
| Other borrowed funds | 1,240 | 1,280 | 1,706 | |||||||
| Total interest expense | 19,756 | 21,201 | 22,328 | |||||||
| Net interest income | 17,453 | 16,908 | 16,070 | |||||||
| Less: Provision (release) for credit losses | 80 | (974 | ) | 72 | ||||||
| Net interest income, after provision (release) for credit losses | 17,373 | 17,882 | 15,998 | |||||||
| Non-interest income: | ||||||||||
| Trust and investment management fees | 4,677 | 4,660 | 4,930 | |||||||
| Net gain on mortgage loans | 1,067 | 377 | 1,264 | |||||||
| Net gain (loss) on loans held for sale | 222 | (222 | ) | 117 | ||||||
| Bank fees | 422 | 426 | 891 | |||||||
| Risk management and insurance fees | 259 | 1,139 | 49 | |||||||
| Income on company-owned life insurance | 110 | 112 | 105 | |||||||
| Net gain (loss) on loans accounted for under the fair value option | 6 | (149 | ) | (302 | ) | |||||
| Net gain on other real estate owned | 459 | — | — | |||||||
| Unrealized gain (loss) recognized on equity securities | 11 | (49 | ) | (6 | ) | |||||
| Other | 112 | 165 | 229 | |||||||
| Total non-interest income | 7,345 | 6,459 | 7,277 | |||||||
| Total income before non-interest expense | 24,718 | 24,341 | 23,275 | |||||||
| Non-interest expense: | ||||||||||
| Salaries and employee benefits | 11,480 | 11,237 | 11,267 | |||||||
| Occupancy and equipment | 2,210 | 2,100 | 1,976 | |||||||
| Professional services | 1,704 | 1,821 | 2,411 | |||||||
| Technology and information systems | 1,078 | 1,073 | 1,010 | |||||||
| Data processing | 1,122 | 1,029 | 948 | |||||||
| Marketing | 216 | 397 | 194 | |||||||
| Amortization of other intangible assets | 51 | 56 | 57 | |||||||
| Other | 1,500 | 2,714 | 1,833 | |||||||
| Total non-interest expense | 19,361 | 20,427 | 19,696 | |||||||
| Income before income taxes | 5,357 | 3,914 | 3,579 | |||||||
| Income tax expense | 1,172 | 1,166 | 1,064 | |||||||
| Net income available to common shareholders | $ | 4,185 | $ | 2,748 | $ | 2,515 | ||||
| Earnings per common share: | ||||||||||
| Basic | $ | 0.43 | $ | 0.28 | $ | 0.26 | ||||
| Diluted | 0.43 | 0.28 | 0.26 | |||||||
|
First Western Financial, Inc. Condensed Consolidated Balance Sheets (unaudited) | |||||||||||
| March 31, | December 31, | March 31, | |||||||||
| (dollars in thousands) | 2025 | 2024 | 2024 | ||||||||
| Assets | |||||||||||
| Cash and cash equivalents: | |||||||||||
| Cash and due from banks | $ | 15,924 | $ | 9,770 | $ | 8,136 | |||||
| Interest-bearing deposits in other financial institutions | 255,658 | 226,271 | 249,753 | ||||||||
| Total cash and cash equivalents | 271,582 | 236,041 | 257,889 | ||||||||
| Held-to-maturity debt securities (fair value of $67,479, $68,161 and $64,908, respectively), net of allowance for credit losses of $71 | 73,775 | 75,724 | 72,303 | ||||||||
| Correspondent bank stock, at cost | 5,968 | 5,864 | 4,461 | ||||||||
| Mortgage loans held for sale, at fair value | 10,557 | 25,455 | 10,470 | ||||||||
| Loans held for sale, at fair value | — | 251 | — | ||||||||
| Loans (includes $6,112, $7,283, and $11,922 measured at fair value, respectively) | 2,425,367 | 2,425,565 | 2,475,524 | ||||||||
| Allowance for credit losses | (17,956 | ) | (18,330 | ) | (24,630 | ) | |||||
| Loans, net | 2,407,411 | 2,407,235 | 2,450,894 | ||||||||
| Premises and equipment, net | 24,554 | 24,129 | 24,869 | ||||||||
| Accrued interest receivable | 10,623 | 10,364 | 11,919 | ||||||||
| Accounts receivable | 4,505 | 4,763 | 4,980 | ||||||||
| Other receivables | 4,608 | 5,710 | 5,254 | ||||||||
| Other real estate owned, net | 4,385 | 35,929 | — | ||||||||
| Goodwill and other intangible assets, net | 31,576 | 31,627 | 31,797 | ||||||||
| Deferred tax assets, net | 2,856 | 3,079 | 5,695 | ||||||||
| Company-owned life insurance | 17,071 | 16,961 | 16,635 | ||||||||
| Other assets | 36,829 | 35,905 | 35,051 | ||||||||
| Total assets | $ | 2,906,300 | $ | 2,919,037 | $ | 2,932,217 | |||||
| Liabilities | |||||||||||
| Deposits: | |||||||||||
| Noninterest-bearing | $ | 409,696 | $ | 375,603 | $ | 434,236 | |||||
| Interest-bearing | 2,105,701 | 2,138,606 | 2,097,734 | ||||||||
| Total deposits | 2,515,397 | 2,514,209 | 2,531,970 | ||||||||
| Borrowings: | |||||||||||
| Federal Home Loan Bank and Federal Reserve borrowings | 51,612 | 57,038 | 69,484 | ||||||||
| Subordinated notes | 44,621 | 52,565 | 52,397 | ||||||||
| Accrued interest payable | 2,371 | 1,995 | 2,415 | ||||||||
| Other liabilities | 35,744 | 40,908 | 30,423 | ||||||||
| Total liabilities | 2,649,745 | 2,666,715 | 2,686,689 | ||||||||
| Shareholders’ Equity | |||||||||||
| Total shareholders’ equity | 256,555 | 252,322 | 245,528 | ||||||||
| Total liabilities and shareholders’ equity | $ | 2,906,300 | $ | 2,919,037 | $ | 2,932,217 | |||||
|
First Western Financial, Inc. Consolidated Financial Summary (unaudited) | |||||||||||
| March 31, | December 31, | March 31, | |||||||||
| (dollars in thousands) | 2025 | 2024 | 2024 | ||||||||
| Loan Portfolio | |||||||||||
| Cash, Securities, and Other(1) | $ | 101,078 | $ | 120,005 | $ | 151,178 | |||||
| Consumer and Other | 16,688 | 17,333 | 18,556 | ||||||||
| Construction and Development | 291,133 | 315,686 | 333,284 | ||||||||
| 1-4 Family Residential | 971,179 | 960,354 | 910,129 | ||||||||
| Non-Owner Occupied CRE | 636,820 | 614,384 | 562,862 | ||||||||
| Owner Occupied CRE | 182,417 | 173,223 | 194,338 | ||||||||
| Commercial and Industrial | 223,197 | 220,501 | 297,573 | ||||||||
| Total | 2,422,512 | 2,421,486 | 2,467,920 | ||||||||
| Loans accounted for under the fair value option | 6,280 | 7,508 | 12,276 | ||||||||
| Total loans held for investment | 2,428,792 | 2,428,994 | 2,480,196 | ||||||||
| Deferred (fees) costs and unamortized premiums/(unaccreted discounts), net(2) | (3,425 | ) | (3,429 | ) | (4,672 | ) | |||||
| Loans (includes $6,112, $7,283, and $11,922 measured at fair value, respectively) | $ | 2,425,367 | $ | 2,425,565 | $ | 2,475,524 | |||||
| Mortgage loans held for sale | 10,557 | 25,455 | 10,470 | ||||||||
| Loans held for sale | — | 251 | — | ||||||||
| Deposit Portfolio | |||||||||||
| Money market deposit accounts | $ | 1,566,737 | $ | 1,513,605 | $ | 1,503,598 | |||||
| Time deposits | 379,533 | 471,415 | 442,834 | ||||||||
| Interest checking accounts | 144,980 | 139,374 | 132,415 | ||||||||
| Savings accounts | 14,451 | 14,212 | 18,887 | ||||||||
| Total interest-bearing deposits | 2,105,701 | 2,138,606 | 2,097,734 | ||||||||
| Noninterest-bearing accounts | 409,696 | 375,603 | 434,236 | ||||||||
| Total deposits | $ | 2,515,397 | $ | 2,514,209 | $ | 2,531,970 | |||||
____________________
| (1) | Includes PPP loans of $1.6 million as of March 31, 2025, $2.1 million as of December 31, 2024, and $3.8 million as of March 31, 2024. |
| (2) | Includes fair value adjustments on loans held for investment accounted for under the fair value option. |
|
First Western Financial, Inc. Consolidated Financial Summary (unaudited) (continued) | |||||||||||
| As of or for the Three Months Ended | |||||||||||
| March 31, | December 31, | March 31, | |||||||||
| (dollars in thousands) | 2025 | 2024 | 2024 | ||||||||
| Average Balance Sheets | |||||||||||
| Assets | |||||||||||
| Interest-earning assets: | |||||||||||
| Interest-bearing deposits in other financial institutions | $ | 198,294 | $ | 236,152 | $ | 177,523 | |||||
| Debt securities | 75,592 | 77,464 | 74,666 | ||||||||
| Correspondent bank stock | 5,806 | 5,738 | 4,451 | ||||||||
| Gross loans | 2,407,482 | 2,386,070 | 2,490,300 | ||||||||
| Mortgage loans held for sale | 13,593 | 26,623 | 6,752 | ||||||||
| Loans held at fair value | 6,846 | 8,136 | 13,134 | ||||||||
| Total interest-earning assets | 2,707,613 | 2,740,183 | 2,766,826 | ||||||||
| Noninterest-earning assets | 145,479 | 161,783 | 100,170 | ||||||||
| Total assets | $ | 2,853,092 | $ | 2,901,966 | $ | 2,866,996 | |||||
| Liabilities and Shareholders’ Equity | |||||||||||
| Interest-bearing liabilities: | |||||||||||
| Interest-bearing deposits | $ | 2,090,505 | $ | 2,095,204 | $ | 2,008,246 | |||||
| FHLB and Federal Reserve borrowings | 51,885 | 54,428 | 92,195 | ||||||||
| Subordinated notes | 52,495 | 52,528 | 52,360 | ||||||||
| Total interest-bearing liabilities | 2,194,885 | 2,202,160 | 2,152,801 | ||||||||
| Noninterest-bearing liabilities: | |||||||||||
| Noninterest-bearing deposits | 363,922 | 403,433 | 446,457 | ||||||||
| Other liabilities | 41,656 | 45,889 | 22,250 | ||||||||
| Total noninterest-bearing liabilities | 405,578 | 449,322 | 468,707 | ||||||||
| Total shareholders’ equity | 252,629 | 250,484 | 245,488 | ||||||||
| Total liabilities and shareholders’ equity | $ | 2,853,092 | $ | 2,901,966 | $ | 2,866,996 | |||||
| Yields/Cost of funds (annualized) | |||||||||||
| Interest-bearing deposits in other financial institutions | 4.54 | % | 4.85 | % | 5.33 | % | |||||
| Debt securities | 3.65 | 3.57 | 3.25 | ||||||||
| Correspondent bank stock | 8.94 | 8.94 | 8.58 | ||||||||
| Loans | 5.71 | 5.65 | 5.66 | ||||||||
| Loan held at fair value | 6.58 | 5.77 | 6.40 | ||||||||
| Mortgage loans held for sale | 5.46 | 6.02 | 6.79 | ||||||||
| Total interest-earning assets | 5.57 | 5.53 | 5.58 | ||||||||
| Interest-bearing deposits | 3.59 | 3.78 | 4.13 | ||||||||
| Total deposits | 3.06 | 3.17 | 3.38 | ||||||||
| FHLB and Federal Reserve borrowings | 3.92 | 3.96 | 4.23 | ||||||||
| Subordinated notes | 5.70 | 5.59 | 5.66 | ||||||||
| Total interest-bearing liabilities | 3.65 | 3.83 | 4.17 | ||||||||
| Net interest margin | 2.61 | 2.45 | 2.34 | ||||||||
| Net interest rate spread | 1.92 | 1.70 | 1.41 | ||||||||
|
First Western Financial, Inc. Consolidated Financial Summary (unaudited) (continued) | |||||||||||
| As of or for the Three Months Ended | |||||||||||
| March 31, | December 31, | March 31, | |||||||||
| (dollars in thousands, except share and per share amounts) | 2025 | 2024 | 2024 | ||||||||
| Asset Quality | |||||||||||
| Non-performing loans | $ | 12,758 | $ | 13,052 | $ | 46,044 | |||||
| Non-performing assets | 17,143 | 48,981 | 46,044 | ||||||||
| Net charge-offs (recoveries) | 566 | (270 | ) | — | |||||||
| Non-performing loans to total loans | 0.53 | % | 0.54 | % | 1.86 | % | |||||
| Non-performing assets to total assets | 0.59 | 1.68 | 1.57 | ||||||||
| Allowance for credit losses to non-performing loans | 140.74 | 140.44 | 53.49 | ||||||||
| Allowance for credit losses to total loans | 0.74 | 0.76 | 1.00 | ||||||||
| Allowance for credit losses to adjusted loans(1) | 0.74 | 0.76 | 1.00 | ||||||||
| Net charge-offs (recoveries) to average loans | 0.02 | (0.01 | ) | — | |||||||
| Assets Under Management | $ | 7,176,624 | $ | 7,321,147 | $ | 7,141,453 | |||||
| Market Data | |||||||||||
| Book value per share at period end | $ | 26.44 | $ | 26.10 | $ | 25.52 | |||||
| Tangible book value per common share(1) | 23.18 | 22.83 | 22.21 | ||||||||
| Weighted average outstanding shares, basic | 9,704,419 | 9,665,621 | 9,621,309 | ||||||||
| Weighted average outstanding shares, diluted | 9,798,591 | 9,794,797 | 9,710,764 | ||||||||
| Shares outstanding at period end | 9,704,320 | 9,667,142 | 9,621,309 | ||||||||
| Consolidated Capital | |||||||||||
| Tier 1 capital to risk-weighted assets | 10.35 | % | 10.07 | % | 9.77 | % | |||||
| CET1 to risk-weighted assets | 10.35 | 10.07 | 9.77 | ||||||||
| Total capital to risk-weighted assets | 13.15 | 13.12 | 13.15 | ||||||||
| Tier 1 capital to average assets | 8.12 | 7.88 | 7.73 | ||||||||
| Bank Capital | |||||||||||
| Tier 1 capital to risk-weighted assets | 11.76 | % | 11.41 | % | 11.00 | % | |||||
| CET1 to risk-weighted assets | 11.76 | 11.41 | 11.00 | ||||||||
| Total capital to risk-weighted assets | 12.52 | 12.10 | 12.02 | ||||||||
| Tier 1 capital to average assets | 9.24 | 8.94 | 8.70 | ||||||||
________________________
| (1) | Represents a Non-GAAP financial measure. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure. |
|
First Western Financial, Inc. Consolidated Financial Summary (unaudited) (continued) | |||||||||||
| Reconciliations of Non-GAAP Financial Measures | |||||||||||
| As of or for the Three Months Ended | |||||||||||
| March 31, | December 31, | March 31, | |||||||||
| (dollars in thousands, except share and per share amounts) | 2025 | 2024 | 2024 | ||||||||
| Tangible Common | |||||||||||
| Total shareholders' equity | $ | 256,555 | $ | 252,322 | $ | 245,528 | |||||
| Less: goodwill and other intangibles, net | 31,576 | 31,627 | 31,797 | ||||||||
| Tangible common equity | $ | 224,979 | $ | 220,695 | $ | 213,731 | |||||
| Common shares outstanding, end of period | 9,704,320 | 9,667,142 | 9,621,309 | ||||||||
| Tangible common book value per share | $ | 23.18 | $ | 22.83 | $ | 22.21 | |||||
| Net income available to common shareholders | 4,185 | 2,748 | 2,515 | ||||||||
| Return on tangible common equity (annualized) | 7.44 | % | 4.98 | % | 4.71 | % | |||||
| Efficiency | |||||||||||
| Non-interest expense | $ | 19,361 | $ | 20,427 | $ | 19,696 | |||||
| Less: OREO expenses and write-downs | (80 | ) | 1,222 | — | |||||||
| Adjusted non-interest expense | $ | 19,441 | $ | 19,205 | $ | 19,696 | |||||
| Total income before non-interest expense | $ | 24,718 | $ | 24,341 | $ | 23,275 | |||||
| Less: unrealized gain (loss) recognized on equity securities | 11 | (49 | ) | (6 | ) | ||||||
| Less: net gain (loss) on loans accounted for under the fair value option | 6 | (149 | ) | (302 | ) | ||||||
| Less: net gain (loss) on loans held for sale | 222 | (222 | ) | 117 | |||||||
| Plus: provision (release) for credit losses | 80 | (974 | ) | 72 | |||||||
| Gross revenue | $ | 24,559 | $ | 23,787 | $ | 23,538 | |||||
| Efficiency ratio | 79.16 | % | 80.74 | % | 83.68 | % | |||||
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