The EPS beat is on a tiny base and profitability remains very low. Watch for continued margin pressure from floating-rate sub debt transition and elevated legal costs. The transformation cost savings expected in late 2026 could provide a catalyst, but until the efficiency ratio falls below 95%, the stock is likely range-bound.
Price Chart
Executive Summary
First Northwest Bancorp (FNWB) reported Q2 2026 EPS of $0.03, beating the $0.01 consensus, but net income of $308K was sharply lower than $3.7M a year ago. Net interest margin compressed to 2.95% (from 3.03% prior quarter), and the efficiency ratio remained above 100% at 101.3%. Loan shrinkage continued (-1% QoQ) while credit quality improved (nonperforming loans fell to $20.7M). The sequential net income improvement from breakeven is modest, and the bank remains in a low-profitability transformation phase.
Key Financial Metrics
Key Facts
- Q2 2026 EPS $0.03 beat consensus $0.01, but net income of $308K vs $3.7M in Q2 2025 (-91.7% YoY)
- Net interest margin declined to 2.95% from 3.03% in Q1 2026; cost of funds rose to 2.42%
- Efficiency ratio 101.3%, meaning expenses exceed revenue
- Net loans receivable decreased 1.0% QoQ to $1.60B; customer deposits grew 0.7%
- Nonperforming loans fell to $20.7M from $21.7M; classified loans down $9.1M to $25.5M
- Recapture of provision for credit losses of $337K (vs $13K recapture prior quarter)
- No shares repurchased under the buyback plan (846,123 shares still available)
- Bank remains well-capitalized: CET1 12.4%, Total risk-based 13.4%
Financial Impact
Net income $308K vs $3.7M YoY, EPS $0.03 vs consensus $0.01; net interest income $14.2M flat YoY
Risk Factors
- Net interest margin compression due to rising cost of funds and loan shrinkage
- Elevated legal and consulting fees from ongoing litigation and efficiency projects
- Subordinated debt floating rate reset (from fixed to floating at end of March 2026) increases interest expense
- Concentration in commercial real estate loans and four large classified loans totaling $18.3M
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 6 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001437749-26-024792 |
| Document: fnwb20260625_8k.htm | 0001437749-26-024792 |
| Document: 0001437749-26-024792-index-headers.html | 0001437749-26-024792 |
| Document: 0001437749-26-024792-index.html | 0001437749-26-024792 |
| Document: 0001437749-26-024792.txt | 0001437749-26-024792 |
| 8-K Data (Synthetic) | 0001437749-26-024792 |
Track record builds as more directional reports settle.
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Sep 18, 2026 5w ago | 8-K | $10.36 | awaiting T+60 | — | $9.79 (−5.50%) |
Jul 29, 2026 12w ago | 8-K | $12.01 $9.65 | ▼ −19.65% | ▼ −24.38% | $9.79 (−18.48%) |
Jun 26, 2026 17w ago | 3 | $10.50 $10.23 | ▼ −2.57% | ▼ −6.96% | $9.79 (−6.76%) |
May 4, 2026 25w ago | 8-K | $9.92 $12.01 | ▲ +21.07% | ▲ +19.21% | $9.79 (−1.31%) |
Apr 29, 2026 25w ago | 8-K | $9.97 $11.95 | ▼ −19.86% | ▼ −15.75% | $9.79 (+1.81%) |
US Market Status
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