Finward Bancorp (FNWD) Investor Presentation summary

Strategic positioning and market presence

• Operates as a community-focused bank with a strong presence in Northwest Indiana and the Chicagoland area, expanding assets from $776 million to $2.1 billion over the past decade at a 10.3% CAGR.

• Successfully integrated five acquisitions since 2014, diversifying into Illinois and broadening fee income through mortgage, treasury, and wealth management.

• Maintains 26 full-service retail locations and a 16-person business banking team, with $406 million in wealth management assets as of September 30, 2024.

• Focuses on relationship-based banking, leveraging technology and selective AI deployment to enhance customer experience and operational efficiency.

• Management aims to build capital, optimize the balance sheet, and improve earnings quality while preparing for varying economic and interest rate scenarios.

Financial performance and capital position

• Total assets stood at $2.08 billion, loans at $1.51 billion, and deposits at $1.75 billion as of September 30, 2024.

• Net interest margin (tax-equivalent) was 2.67% for Q3 2024, with expectations for gradual yield improvements as loans reprice.

• Tier 1 leverage ratio was 8.38%, and tangible common equity to total assets was 6.51%, both indicating strong capital adequacy.

• Tangible book value per diluted share adjusted for AOCI reached $42.47 at quarter-end.

• Available liquidity totaled $686 million, with 72% of deposits fully FDIC insured and an additional 7% backed by Indiana's Public Deposit Insurance Fund.

Loan portfolio and asset quality

• Loan portfolio remained stable in 2024, with $70.4 million in new commercial loans originated in Q3 and $20.1 million in 1-4 family originations.

• Commercial real estate loans are well diversified, with office-based loans comprising only 2.8% of balances and non-performing multifamily loans at 1.62% of the segment.

• Non-performing loans increased to $13.8 million (0.92% of loans) in Q3 2024, mainly due to a single commercial relationship.

• Allowance for credit losses covered 192.89% of non-performing loans, with a 1.23% ACL to loans ratio.

• The bank emphasizes proactive risk management and timely risk ratings to support balance sheet decisions.