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CST: 10/12/2019 20:18:36   

Northrim BanCorp Earns $4.3 Million, or $0.62 per Diluted Share, in 2Q19 Fueled by Solid Loan Growth, Improved Asset Quality, and Strong Net Interest Margin

134 Days ago

ANCHORAGE, Alaska, July 29, 2019 (GLOBE NEWSWIRE) -- Northrim BanCorp, Inc. (NASDAQ:NRIM) (“Northrim” or the "Company") today reported net income was $4.3 million, or $0.62 per diluted share, in the second quarter of 2019, in line with first quarter 2019, and down from $5.8 million, or $0.84 per diluted share, in the second quarter of 2018.  The year-over year decline in net income reflects higher second quarter 2019 costs for medical and other employee benefits, and additional expenses related to the new branches opened in Soldotna on the Kenai peninsula and in East Anchorage over the past year, as well as the impact from non-core increases in net income in the second quarter of 2018.

Portfolio loans increased 5% to $1.02 billion at the end of the second quarter compared to $967.7 million a year ago.  Net interest margin ("NIM") improved 21 basis points to 4.71% in the second quarter of 2019 from a year ago and compressed 12 basis points from the first quarter of 2019.  Generally rising interest rates in the last year contributed to the year-over-year margin expansion, while the inversion of the yield curve for 3-to 5- year maturities reduced yields on loans with these durations during the second quarter of 2019.

Net income for the first six months of 2019 were $8.6 million, or $1.24 per diluted share, compared to $9.9 million, or $1.42 per diluted share, in the first six months of 2018.  In the first half of 2019, operating results include increased operating expenses of $36.9 million, up from $33.4 million in the first half of 2018 primarily due to increased salaries and wages and medical costs. The provision for loan losses also increased to $1.1 million, compared to a $300,000 recovery of loan loss provisions in the first half of 2018.

“Our loan pipeline, for both home mortgages and business loans, continues to be robust and supports our ability to build shareholder value,” said Joe Schierhorn, President and CEO.

Second Quarter 2019 Highlights:

  • Total revenue, which includes net interest income plus other operating income, increased 10% to $25.5 million in the second quarter of 2019, compared to $23.3 million in the first quarter of 2019 and in the second quarter a year ago.
    • Community Banking provided 75% of total revenues and 91% of earnings in the second quarter of 2019.
    • Home Mortgage Lending began its normal seasonal improvement in demand for new home loans with commitments increasing 62% in the quarter and 28% year-over-year. Loans funded for sale grew 83% in the quarter and 14% year-over-year. Interest rate decreases impacted earnings in the segment with fair value decreases in servicing rights and improvements in refinancing activity.
  • Net interest income in the second quarter of 2019 increased 6% to $16.0 million from $15.0 million in the second quarter a year ago, mainly due to the higher yields on the loan and investment portfolios.
  • Net interest margin on a tax equivalent basis (“NIMTE”)* was 4.77% in the second quarter, a 21 basis point improvement compared to the second quarter a year ago, and a 12 basis point contraction compared to the preceding quarter.
  • Other operating income benefited from $734,000 in income from an interest rate swap to fix interest costs for a customer.
  • Return on average assets was 1.12% and return on average equity was 8.13% for the second quarter of 2019.
  • The Company repurchased 149,373 shares of its common stock in the second quarter of 2019 at an average price of $34.79, leaving 192,193 shares available under the previously announced repurchase authorization.
Financial Highlights Three Months Ended
(Dollars in thousands, except per share data) June 30, 2019 March 31, 2019 December 31, 2018 September 30, 2018 June 30, 2018
Total assets $1,552,770   $1,520,051   $1,502,988   $1,502,673   $1,470,440  
Total portfolio loans $1,015,704   $982,341   $984,346   $982,007   $967,702  
Average portfolio loans $1,003,019   $988,920   $981,407   $984,914   $963,724  
Total deposits $1,288,178   $1,228,018   $1,228,088   $1,233,268   $1,205,521  
Average deposits $1,239,354   $1,194,512   $1,233,479   $1,223,997   $1,217,903  
Total shareholders' equity $206,338   $208,838   $205,947   $203,242   $199,456  
Net income $4,261   $4,312   $4,848   $5,264   $5,830  
Diluted earnings per share $0.62   $0.62   $0.69   $0.75   $0.84  
Return on average assets   1.12 %   1.18 %   1.27 %   1.40 %   1.58 %
Return on average shareholders' equity   8.13 %   8.36 %   9.30 %   10.27 %   11.79 %
NIM   4.71 %   4.83 %   4.71 %   4.69 %   4.50 %
NIMTE*   4.77 %   4.89 %   4.76 %   4.74 %   4.56 %
Efficiency ratio   77.58 %   73.23 %   76.64 %   73.82 %   71.19 %
Total shareholders' equity/total assets   13.29 %   13.74 %   13.70 %   13.53 %   13.56 %
Tangible common equity/tangible assets*   12.38 %   12.81 %   12.76 %   12.58 %   12.60 %
Book value per share $30.66   $30.36   $29.92   $29.52   $29.02  
Tangible book value per share* $28.27   $28.01   $27.57   $27.17   $26.66  
Dividends per share $0.30   $0.30   $0.27   $0.27   $0.24  

* References to NIMTE, tangible book value per share, tangible common equity and tangible assets (all of which exclude intangible assets) represent non-GAAP financial measures. Management has presented these non-GAAP measurements in this earnings release, because it believes these measures are useful to investors. See the end of this release for reconciliations of these non-GAAP financial measures to GAAP financial measures.

Alaska Economic Update
(Note: sources for information included in this section are included on page 10.)

Alaska’s economic indicators continue to show signs of improvement. There have been modest job gains, growing personal income and wages, and rising gross state product ("GSP"). According to the State Department of Labor, Alaska has registered year-over-year job gains for eight consecutive months after losing jobs for the prior 36 months. Job growth in 2019 has been led by construction, oil & gas, health care and the leisure & hospitality sectors. Somewhat offsetting this growth has been declines year-over-year in seafood processing, financial activities and the information sectors.  The seasonally adjusted unemployment rate in Alaska was 6.4% in May 2019 after finishing nine consecutive months at 6.5%.  “While job growth is modest, improving employment indicates Alaska began to recover from its three-year long mild recession in October 2018.  In addition, per capita income and GSP figures showed positive improvement in 2018,” stated Mark Edwards, Chief Credit Officer and Bank Economist.

Alaska’s seasonally adjusted GSP in real terms was $54.9 billion in the fourth quarter of 2018, according to the U.S. Bureau of Economic Analysis (“BEA”) in a report released on May 1, 2019.  Alaska’s real GSP declined by 5.7% annualized in the first quarter of 2018, but then grew by 1.7%, 2.9% and 4.9% in the second, third and fourth quarters, respectively.

The BEA also reported that Alaska’s per capita income in 2018 was $59,687.  That is a 4.4% increase from $57,163 in 2017.  Alaska ranked 10th highest in per capita income in the country in both years.  Total income in 2018 in Alaska was $44 billion, up from $42.3 billion in 2017, despite a small population loss.  The improvement in total income consisted of $801 million from wage earnings, $264 million from investments and rents, and $649 million from increased government transfer payments.

“An important risk factor that is impacting the current economic recovery is the uncertainty surrounding the State's budget and the long term fiscal plan for the State,” said Schierhorn.

Northrim Bank sponsors the Alaskanomics blog to provide news, analysis, and commentary on Alaska’s economy.  Join the conversation at Alaskanomics.com, or for more information on the Alaska economy, visit: www.northrim.com and click on the “Business Banking” link and then click “Learn.” Information from our website is not incorporated into, and does not form, a part of this earnings release.

Review of Income Statement

Consolidated Income Statement

In the second quarter of 2019, Northrim generated a return on average assets ("ROAA") of 1.12% and a return on average equity ("ROAE") of 8.13%, compared to 1.18% and 8.36%, respectively in the first quarter of 2019 and 1.58% and 11.79%, respectively, in the second quarter a year ago.

Net Interest Income/Net Interest Margin

Net interest income grew 6% to $16.0 million in the second quarter of 2019 compared to $15.0 million in the second quarter of 2018 and increased modestly compared to $15.8 million in the first quarter of 2019. For the first six months of 2019, net interest income increased 8% to $31.7 million from $29.2 million in the first six months of 2018.

NIMTE* was 4.77% in the second quarter of 2019 compared to 4.89% in the preceding quarter and 4.56% in the second quarter a year ago.  The growth in the loan portfolio more than offset increased cost of interest-bearing deposits and borrowings in both the second quarter and first half of 2019 compared to the year ago periods.  The yield on interest earning assets in the second quarter was 5.17%, down 6 basis points from the first quarter of 2019 and up 43 basis points year-over-year.  The cost of funds increased in the second quarter of 2019 to 63 basis points, up 10 basis points from the preceding quarter and up 35 basis points compared to the second quarter a year ago.

“We continue to believe maintaining a relatively short duration for our loan and investment portfolios is a prudent capital management strategy,” said Jed Ballard, Chief Financial Officer. “The current differential in yields between short- and long-term investments does not warrant the added interest rate risks inherent in extending maturities for our investments or duration of our loan portfolio.”

Provision for Loan Losses

Northrim recorded a $300,000 provision for loan losses in the second quarter of 2019, compared to a $750,000 provision in the first quarter of 2019.  In the second quarter a year ago, Northrim recorded a benefit for loan losses of $300,000.  Nonperforming loans, net of government guarantees, decreased during the quarter to $16.9 million at June 30, 2019, compared to $18.5 million at March 31, 2019, and increased slightly from $16.3 million at June 30, 2018.  The allowance for loan losses was 121% of nonperforming loans, net of government guarantees at June 30, 2019.  “While asset quality improved in the quarter, growth in the loan portfolio prompted the increases in reserves,” said Ballard.

Other Operating Income

In addition to home mortgage lending, Northrim has interests in other businesses that complement its core community banking activities, including purchased receivables financing and wealth management.  Other operating income contributed $9.6 million, or 37% of total second quarter 2019 revenues, as compared to $7.5 million, or 32% of revenues in the first quarter of 2019, and $8.3 million, or 36% of revenues in the second quarter of 2018.  In the first six months of 2019, other operating income totaled $17.1 million, or 35% of revenues, compared to $15.8 million, or 35% of revenues in 2018.  The primary drivers of changes in other operating income are variability in the mortgage market, which is seasonal and cyclical, and gains or losses from the fair value changes of marketable equity securities.  The fair value mark-to-market of the marketable equity securities portfolio increased other income by $118,000 in the second quarter of 2019, compared to a $534,000 increase in the first quarter of 2019. Additionally, $734,000 in interest rate swap income was earned in 2019 on the execution of three new interest rate swaps related to the  Company's commercial lending operations.

Other Operating Expenses

Operating expenses were $19.8 million in the second quarter of 2019, compared to $17.1 million in the first quarter of 2019 and $16.6 million in the second quarter of 2018.  Impacting salaries and other personnel expenses during the second quarter was a significant increase in medical costs associated with Northrim’s self-insured medical plan, costs associated with the two new branch locations in Soldotna and East Anchorage, and higher compensation costs for the mortgage banking operations due to increased loan originations.  In the first six months of 2019, operating expenses were $36.9 million, up from $33.4 million in the first six months of 2018, reflecting higher medical expenses, higher compensation costs for the mortgage banking operations and an increase in occupancy expenses, as explained above.  “In addition, we continue to invest in technology, which increased data processing costs, to introduce new products and services and enhance our competitive position in Alaska,” said Schierhorn.

Income Tax Provision

For the second quarter of 2019, Northrim recorded $1.1 million in state and federal income tax expense for an effective tax rate of 21.2% compared to $1.2 million, or 16.7% in the second quarter a year ago. For the first half of 2019, Northrim recorded $2.3 million in state and federal income tax expense, for an effective tax rate of 21.2% compared to $2.0 million and 17.1% for the same period in 2018.

Community Banking

“Our Alaska franchise continues to provide long-term opportunities in the market, and our recent branch expansions are bringing in new customers and expanding relationships with the customers and communities we serve,” said Schierhorn.

Net interest income in the Community Banking segment increased 7% to $15.6 million in the second quarter of 2019 from $14.6 million in the second quarter of 2018.

The following table provides highlights of the Community Banking segment of Northrim:

  Three Months Ended
(Dollars in thousands, except per share data) June 30, 2019 March 31, 2019 December 31, 2018 September 30, 2018 June 30, 2018
Net interest income $15,633   $15,488   $15,719   $15,358   $14,614  
Provision (benefit) for loan losses   300     750     (200 )       (300 )
Other operating income   3,619     3,235     3,199     2,770     2,836  
Other operating expense   14,111     12,518     13,637     12,204     11,748  
  Income before provision for income taxes   4,841     5,455     5,481     5,924     6,002  
Provision for income taxes   984     1,155     824     996     882  
  Net income $3,857   $4,300   $4,657   $4,928   $5,120  
Average diluted shares   6,896,687     6,981,951     6,990,319     6,990,633     6,976,985  
Diluted earnings per share $0.56   $0.62   $0.66   $0.70   $0.74  


  Year-to-date
(Dollars in thousands, except per share data) June 30, 2019 June 30, 2018
Net interest income $31,121   $28,650  
(Benefit) provision for loan losses   1,050     (300 )
Other operating income   6,854     5,354  
Other operating expense   26,629     24,115  
  Income before provision for income taxes   10,296     10,189  
Provision for income taxes   2,139     1,541  
  Net income $8,157   $8,648  
     
Average diluted shares   6,939,338     6,972,744  
Diluted earnings per share $1.18   $1.24  

Home Mortgage Lending

“Warm spring weather, continued stability in middle-market home prices, and improved affordability for mortgages contributed to support growth in our home mortgage lending business.  This year, again, we saw normal seasonality in the mortgage market with higher demand in the spring and summer and lower demand in autumn and winter,” said Ballard.  “Loan fundings increased during the quarter and year-over-year driven by increased refinance activity as a result of lower interest rates. Second quarter of 2019 volume increased to $169.0 million, of which 82% were for new home purchases, compared to $92.4 million and 84% of loans funded in the first quarter of 2019 and $148.2 million of which 92% were for new home purchases in the second quarter of 2018.

“Our mortgage servicing business, which was initiated in the fourth quarter of 2015 to service loans for the Alaska Housing Finance Corporation, continues to grow,” Ballard noted.  As of June 30, 2019, Northrim serviced 2,397 loans in its $598.4 million home-mortgage-servicing portfolio, which is a 27% increase from the $472.2 million serviced a year ago.  Mortgage servicing revenue contributed $1.1 million to revenues in the second quarter of 2019 compared to $1.3 million in the second quarter of 2018.  Total mortgage servicing income fluctuates based on the amount of mortgage servicing rights originated during the period and changes in the fair value of mortgage servicing rights, which are driven by interest rate volatility and fluctuations in estimated prepayment speeds based on published industry metrics. The change in the fair value of mortgage servicing rights was a decrease of $950,000 for the second quarter of 2019 compared to a decrease of $674,000 for the first quarter of 2019 and a decrease of $118,000 for the second quarter of 2018. In the first six months of 2019 the change in fair value of mortgage servicing rights was a decrease of $1.6 million as compared to a decrease of $144,000 for the first six months of 2018.

The following table provides highlights of the Home Mortgage Lending segment of Northrim:

  Three Months Ended
(Dollars in thousands, except per share data) June 30, 2019 March 31, 2019 December 31, 2018 September 30, 2018 June 30, 2018
Mortgage commitments $107,330   $66,319   $44,999   $69,026   $84,092  
Mortgage loans funded for sale $168,953   $92,447   $113,963   $156,301   $148,183  
Mortgage loan refinances to total fundings   18 %   16 %   10 %   9 %   8 %
Mortgage loans serviced for others $598,415   $586,595   $557,583   $516,008   $472,190  
           
Net realized gains on mortgage loans sold $4,903   $2,927   $3,156   $4,268   $4,052  
Change in fair value of mortgage loan commitments, net   655     356     (442 )   (66 )   32  
Total production revenue   5,558     3,283     2,714     4,202     4,084  
Mortgage servicing revenue   1,119     1,668     1,526     1,578     1,254  
Change in fair value of mortgage servicing rights, net1   (950 )   (674 )   145     (128 )   (118 )
Total mortgage servicing revenue, net   169     994     1,671     1,450     1,136  
Other mortgage banking revenue   223     21     134     251     258  
  Total mortgage banking income $5,950   $4,298   $4,519   $5,903   $5,478  
           
Net interest income $324   $281   $418   $461   $375  
Mortgage banking income   5,950     4,298     4,519     5,903     5,478  
Other operating expense   5,708     4,562     4,663     5,895     4,858  
  Income before provision for income taxes   566     17     274     469     995  
Provision for income taxes   162     5     83     133     285  
  Net income $404   $12   $191   $336   $710  
           
Average diluted shares   6,896,687     6,981,951     6,990,319     6,990,633     6,976,985  
Diluted earnings per share $0.06     $—   $0.03   $0.05   $0.10  

1Principally reflects changes in discount rates and prepayment speed assumptions, which are primarily affected by changes in interest rates, net of collection/realization of expected cash flows over time.

  Year-to-date
(Dollars in thousands, except per share data) June 30, 2019 June 30, 2018
Mortgage loans funded for sale $261,400   $257,252  
Mortgage loan refinances to total fundings   17 %   12 %
     
Net realized gains on mortgage loans sold $7,830   $7,398  
Change in fair value of mortgage loan commitments, net   1,011     348  
Total production revenue   8,841     7,746  
Mortgage servicing revenue   2,787     2,438  
Change in fair value of mortgage servicing rights, net1   (1,624 )   (144 )
Total mortgage servicing revenue, net   1,163     2,294  
Other mortgage banking revenue   244     382  
  Total mortgage banking income $10,248   $10,422  
     
Net interest income $605   $602  
Mortgage banking income   10,248     10,422  
Other operating expense   10,270     9,286  
  Income before provision for income taxes   583     1,738  
Provision for income taxes   167     494  
  Net income $416   $1,244  
     
Average diluted shares   6,939,338     6,972,744  
Diluted earnings per share $0.06   $0.18  

1Principally reflects changes in discount rates and prepayment speed assumptions, which are primarily affected by changes in interest rates, net of collection/realization of expected cash flows over time.

Balance Sheet Review

Northrim’s total assets were $1.55 billion at June 30, 2019, up 2% from the preceding quarter and up 6% from a year ago.  Northrim’s loan-to-deposit ratio was 79% at June 30, 2019, down from 80% at both March 31, 2019 and June 30, 2018.

Average interest-earning assets were $1.36 billion in the second quarter of 2019, up 3% from $1.32 billion in the first quarter of 2019 and up 2% from $1.34 billion in the second quarter a year ago.  The average yield on interest-earning assets was 5.17% in the second quarter of 2019, down from 5.23% in the preceding quarter and up from 4.74% in the second quarter a year ago.

Average investment securities increased slightly to $281.5 million at June 30, 2019, compared to $280.4 million in the first quarter of 2019 and decreased 2% from $287.0 million in the second quarter a year ago.  The average net tax equivalent yield on the securities portfolio improved to 2.71% for the second quarter of 2019, from 2.65% in the preceding quarter and 2.09% a year ago*.  The average estimated duration of the investment portfolio was 19 months, at June 30, 2019.

“During the second quarter of 2019, loan originations more than offset the rate of repayments that results from the short duration of the loan portfolio.  Commercial loans increased to 38% of total loans, offsetting small reductions in commercial real estate and construction loans in the second quarter of 2019.  Portfolio loans were $1.02 billion at June 30, 2019, up 3% from the preceding quarter and up 5% from a year ago.  Average portfolio loans in the second quarter of 2019 were $1.00 billion, up slightly from the preceding quarter and up 4% from a year ago.  Yields on average portfolio loans in the second quarter of 2019 declined to 5.96% from 6.04% in the first quarter of 2019 and improved compared to 5.65% in the second quarter of 2018.

Alaskans account for substantially all of Northrim’s deposit base, which is primarily made up of low-cost transaction accounts.  Balances in transaction accounts at June 30, 2019, represented 90% of total deposits.  At June 30, 2019, total deposits were $1.29 billion, up 5% from $1.23 billion at March 31, 2019, and up 7% from $1.21 billion a year ago.  Average interest-bearing deposits were up 2% to $818.1 million with an average cost of 0.58% in the second quarter of 2019, compared to $800.5 million and an average cost of 0.48% in the first quarter of 2019, and down slightly from $818.6 million and an average cost of 0.22% in the second quarter of 2018.

“In the second quarter, we introduced improved commercial sweep accounts with enhanced services for our business customers,” said Schierhorn.  “This expansion of our deposit products and services improves our competitive position in the Alaska market.”

Shareholders’ equity was $206.3 million, or $30.66 per share, at June 30, 2019, compared to $208.8 million, or $30.36 per share, at March 31, 2019 and $199.5 million, or $29.02 per share, a year ago.  Tangible book value per share* was $28.27 at June 30, 2019, up from $26.66 per share a year ago.  Northrim continues to maintain capital levels in excess of the requirements to be categorized as “well-capitalized” under the Basel III and Dodd Frank regulatory standards with Tier 1 Capital to Risk Adjusted Assets of 15.03% at June 30, 2019.  Investments in share repurchases accounted for the modest decline in shareholder equity in the second quarter of 2019 compared to the preceding quarter.

Asset Quality

Nonperforming assets ("NPAs") net of government guarantees improved to $23.9 million at June 30, 2019, compared to $25.5 million at March 31, 2019, and $24.0 million at June 30, 2018.  Of the NPAs, $13.3 million, or 56% are nonaccrual loans related to six commercial relationships. Two of these relationships, which totaled $6.3 million at the end of the second quarter of 2019, are businesses in the medical industry.

Net adversely classified loans improved to $25.0 million at the end of the second quarter of 2019 as compared to $27.1 million at the end of the first quarter of 2019, and $33.2 million one year ago.  Loan recoveries were greater than loan charge-offs in the second quarter by $9,000, compared to $60,000 in net loan charge-offs in the first quarter of 2019 and $41,000 in net loan charge-offs in the year ago quarter.  Year to date, net loan charge-offs were $51,000, compared to $1.1 million in the first six months of 2018.  Adversely classified loans are loans that Northrim has classified as substandard, doubtful, and loss, net of government guarantees.  As of June 30, 2019, $18.8 million, or 75% of net adversely classified loans are attributable to eight relationships with four loans to commercial businesses, two loans to medical businesses, and two loans to oilfield services commercial businesses.

Performing restructured loans that were not included in nonaccrual loans at the end of the second quarter of 2019 were $1.6 million, down from $3.4 million in the preceding quarter and from $9.1 million a year ago.  The decrease in the second quarter of 2019 compared to the year ago quarter is primarily due to the repayment of one commercial relationship.  Borrowers who are in financial difficulty and who have been granted concessions that may include interest rate reductions, term extensions, or payment alterations are categorized as restructured loans.  The Company presents restructured loans that are performing separately from those that are classified as nonaccrual to provide more information on this category of loans and to differentiate between accruing performing and nonperforming restructured loans.

Northrim estimates that $64.4 million, or approximately 6% of portfolio loans as of June 30, 2019, had direct exposure to the oil and gas industry in Alaska, and $2.7 million of these loans are adversely classified.  As of June 30, 2019, Northrim has an additional $32.0 million in unfunded commitments to companies with direct exposure to the oil and gas industry in Alaska, and none of these unfunded commitments are considered to be adversely classified loans.

“We continue to define direct exposure to the oil and gas sector as loans to borrowers that provide oilfield services and other companies that we have identified as significantly reliant upon activity in Alaska related to the oil and gas industry, such as lodging, equipment rental, transportation and other logistics services specific to this industry,” added Ballard.

About Northrim BanCorp

Northrim BanCorp, Inc. is the parent company of Northrim Bank, an Alaska-based community bank with 16 branches in Anchorage, the Matanuska Valley, Soldotna, Juneau, Fairbanks, Ketchikan, and Sitka serving 90% of Alaska’s population; and an asset based lending division in Washington; and a wholly-owned mortgage brokerage company, Residential Mortgage Holding Company, LLC. The Bank differentiates itself with its detailed knowledge of Alaska’s economy and its “Customer First Service” philosophy. Pacific Wealth Advisors, LLC is an affiliated company of Northrim BanCorp.

www.northrim.com

Forward-Looking Statement
This release may contain “forward-looking statements” as that term is defined for purposes of Section 21E of the Securities Exchange Act of 1934, as amended.  These statements are, in effect, management’s attempt to predict future events, and thus are subject to various risks and uncertainties. Readers should not place undue reliance on forward-looking statements, which reflect management’s views only as of the date hereof. All statements, other than statements of historical fact, regarding our financial position, business strategy and management’s plans and objectives for future operations are forward-looking statements.  When used in this report, the words “anticipate,” “believe,” “estimate,” “expect,” and “intend” and words or phrases of similar meaning, as they relate to Northrim and its management are intended to help identify forward-looking statements.  Although we believe that management’s expectations as reflected in forward-looking statements are reasonable, we cannot assure readers that those expectations will prove to be correct.  Forward looking statements are subject to various risks and uncertainties that may cause our actual results to differ materially and adversely from our expectations as indicated in the forward-looking statements.  These risks and uncertainties include: our ability to maintain strong asset quality and to maintain or expand our market share or net interest margins; and our ability to execute our business plan.  Further, actual results may be affected by our ability to compete on price and other factors with other financial institutions; customer acceptance of new products and services; the regulatory environment in which we operate; and general trends in the local, regional and national banking industry and economy as those factors relate to our cost of funds and return on assets.  In addition, there are risks inherent in the banking industry relating to collectability of loans and changes in interest rates.  Many of these risks, as well as other risks that may have a material adverse impact on our operations and business, are identified in the “Risk Factors” section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, and from time to time are disclosed in our other filings with the Securities and Exchange Commission.  However, you should be aware that these factors are not an exhaustive list, and you should not assume these are the only factors that may cause our actual results to differ from our expectations.  These forward-looking statements are made only as of the date of this release, and Northrim does not undertake any obligation to release revisions to these forward-looking statements to reflect events or conditions after the date of this release.

References:

https://www.alaskanomics.com/alaskas-economy/

http://labor.alaska.gov/trends/jul19.pdf

http://live.laborstats.alaska.gov/qcew/

https://www.bls.gov/eag/eag.ak.htm

https://pubs.iseralaska.org/media/1ef3a5d2-2efe-4f83-9ab5-c719d0202edd/2019_07_08-VetoEconomicImpacts.pdf

https://www.bea.gov/data/income-saving/personal-income-by-state

https://www.bea.gov/data/gdp/gdp-state

http://almis.labor.state.ak.us/


Income Statement            
(Dollars in thousands, except per share data) Three Months Ended   Year-to-date
(Unaudited) June 30, March 31, June 30,   June 30, June 30,
    2019   2019   2018     2019   2018
Interest Income:            
  Interest and fees on loans $15,353   $14,977   $14,036     $30,330   $27,299  
  Interest on portfolio investments   1,818     1,758     1,400       3,576     2,748  
  Interest on deposits in banks   135     143     159       278     343  
  Total interest income   17,306     16,878     15,595       34,184     30,390  
Interest Expense:            
  Interest expense on deposits   1,174     938     446       2,112     818  
  Interest expense on borrowings   175     171     160       346     320  
  Total interest expense   1,349     1,109     606       2,458     1,138  
  Net interest income   15,957     15,769     14,989       31,726     29,252  
             
Provision (benefit) for loan losses   300     750     (300 )     1,050     (300 )
  Net interest income after provision for loan losses   15,657     15,019     15,289       30,676     29,552  
             
Other Operating Income:            
  Mortgage banking income   5,950     4,298     5,478       10,248     10,422  
  Purchased receivable income   837     809     867       1,646     1,707  
  Bankcard fees   744     650     707       1,394     1,332  
  Interest rate swap income   734               734      
  Service charges on deposit accounts   413     413     376       826     730  
  Gain (loss) on marketable equity securities   118     534     (173 )     652     (173 )
  Gain on sale of securities       23           23      
  Other income   773     806     1,059       1,579     1,758  
  Total other operating income   9,569     7,533     8,314       17,102     15,776  
             
Other Operating Expense:            
  Salaries and other personnel expense   12,945     11,302     11,362       24,247     21,947  
  Data processing expense   1,796     1,679     1,323       3,475     2,871  
  Occupancy expense   1,642     1,771     1,020       3,413     2,720  
  Marketing expense   833     419     462       1,252     1,094  
  Professional and outside services   684     556     554       1,240     1,053  
  Insurance expense   232     258     178       490     474  
  Intangible asset amortization expense   15     15     17       30     35  
  OREO expense, net rental income and gains on sale   165     (320 )   11       (155 )   114  
  Other operating expense   1,507     1,400     1,679       2,907     3,093  
  Total other operating expense   19,819     17,080     16,606       36,899     33,401  
             
  Income before provision for income taxes   5,407     5,472     6,997       10,879     11,927  
  Provision for income taxes   1,146     1,160     1,167       2,306     2,035  
  Net income $4,261   $4,312   $5,830     $8,573   $9,892  
             
  Basic EPS $0.62   $0.63   $0.85     $1.25   $1.44  
  Diluted EPS $0.62   $0.62   $0.84     $1.24   $1.42  
  Average basic shares   6,798,352     6,879,619     6,872,371       6,838,986     6,872,167  
  Average diluted shares   6,896,687     6,981,951     6,976,985       6,939,338     6,972,744  


Balance Sheet      
(Dollars in thousands)      
(Unaudited) June 30, March 31, June 30,
  2019  2019  2018
       
Assets:      
  Cash and due from banks $25,377   $30,266   $26,355  
  Interest bearing deposits in other banks   45,454     48,667     9,775  
  Investment securities available for sale   249,986     274,441     264,124  
  Marketable equity securities   7,916     7,798     6,006  
  Investment in Federal Home Loan Bank stock   2,069     2,071     2,104  
  Loans held for sale   61,531     30,211     54,306  
  Portfolio loans   1,015,704     982,341     967,702  
  Allowance for loan losses   (20,518 )   (20,209 )   (20,108 )
  Net portfolio loans   995,186     962,132     947,594  
  Purchased receivables, net   13,114     21,286     20,323  
  Mortgage servicing rights   10,836     11,254     8,733  
  Other real estate owned, net   7,043     7,043     8,959  
  Premises and equipment, net   39,155     38,978     38,113  
  Lease right of use asset   14,924     15,485      
  Goodwill and intangible assets   16,124     16,139     16,189  
  Other assets   64,055     54,280     67,859  
  Total assets $1,552,770 $1,520,051 $1,470,440
       
Liabilities:      
  Demand deposits $435,425   $417,068   $401,925  
  Interest-bearing demand   285,664     247,630     246,628  
  Savings deposits   232,190     237,510     237,978  
  Money market deposits   204,151     204,567     223,189  
  Time deposits   130,748     121,243     95,801  
  Total deposits   1,288,178     1,228,018     1,205,521  
  Securities sold under repurchase agreements   864     34,621     27,695  
  Other borrowings   7,158     7,200     7,312  
  Junior subordinated debentures   10,310     10,310     10,310  
  Lease liability   14,807     15,358      
  Other liabilities   25,115     15,706     20,146  
  Total liabilities   1,346,432     1,311,213     1,270,984  
       
Shareholders' Equity:      
  Total shareholders' equity   206,338     208,838     199,456  
  Total liabilities and shareholders' equity $1,552,770   $1,520,051   $1,470,440  
       

Additional Financial Information
(Dollars in thousands)
(Unaudited)

Composition of Portfolio Investments              
  June 30, 2019   March 31, 2019   June 30, 2018
  Balance % of total   Balance % of total   Balance % of total
U.S. Treasury securities $55,349   21.5 %   $55,037   19.5 %   $39,534   14.6 %
U.S. Agency securities   127,417   49.4 %     157,260   55.7 %     169,158   62.7 %
Corporate securities   40,400   15.7 %     40,337   14.3 %     37,490   13.9 %
Marketable equity securities   7,916   3.1 %     7,798   2.8 %     6,006   2.2 %
Collateralized loan obligations   22,931   8.9 %     17,909   6.3 %     6,007   2.2 %
Alaska municipality, utility, or state bonds   3,739   1.4 %     3,748   1.3 %     7,348   2.7 %
Other municipality, utility, or state bonds   150   0.1 %     150   0.1 %     4,587   1.7 %
  Total portfolio investments $257,902       $282,239       $270,130    
                 


Composition of Portfolio Loans                        
  June 30, 2019   March 31, 2019   December 31, 2018   September 30, 2018   June 30, 2018
  Balance % of total   Balance % of total   Balance % of total   Balance % of total   Balance % of total
Commercial loans $387,257   38 %   $344,164   35 %   $342,420   35 %   $333,132   34 %   $327,733   34 %
CRE owner occupied loans   126,991   12 %     130,141   13 %     126,414   13 %     130,166   13 %     127,384   13 %
CRE nonowner occupied loans   367,703   36 %     360,071   37 %     367,759   37 %     382,313   39 %     385,648   40 %
Construction loans   97,837   10 %     109,404   11 %     109,367   11 %     97,976   10 %     89,433   9 %
Consumer loans   40,234   4 %     42,861   4 %     42,873   4 %     42,775   4 %     41,711   4 %
  Subtotal   1,020,022         986,641         988,833         986,362         971,909    
Unearned loan fees, net   (4,318 )       (4,300 )       (4,487 )       (4,355 )       (4,207 )  
  Total portfolio loans $1,015,704       $982,341       $984,346       $982,007       $967,702    
                             


Composition of Deposits                        
  June 30, 2019   March 31, 2019   December 31, 2018   September 30, 2018   June 30, 2018
  Balance % of total   Balance % of total   Balance % of total   Balance % of total   Balance % of total
Demand deposits $435,425   34 %   $417,068   34 %   $420,988   35 %   $450,409   36 %   $401,925   33 %
Interest-bearing demand   285,664   22 %     247,630   20 %     248,056   20 %     240,974   20 %     246,628   20 %
Savings deposits   232,190   18 %     237,510   19 %     239,054   19 %     233,611   19 %     237,978   20 %
Money market deposits   204,151   16 %     204,567   17 %     206,717   17 %     208,614   17 %     223,189   19 %
Time deposits   130,748   10 %     121,243   10 %     113,273   9 %     99,660   8 %     95,801   8 %
  Total deposits $1,288,178       $1,228,018       $1,228,088       $1,233,268       $1,205,521    

Additional Financial Information
(Dollars in thousands)
(Unaudited)

Asset Quality            
  June 30,   March 31,   June 30,  
   2019    2019    2018  
  Nonaccrual loans $18,080     $19,516     $16,635    
  Loans 90 days past due and accruing                  
  Total nonperforming loans   18,080       19,516       16,635    
  Nonperforming loans guaranteed by government   (1,139 )     (1,038 )     (327 )  
  Net nonperforming loans   16,941       18,478       16,308    
  Other real estate owned   7,043       7,043       8,959    
  Repossessed assets   1,182       1,242          
  Other real estate owned guaranteed by government   (1,279 )     (1,279 )     (1,280 )  
  Net nonperforming assets $23,887     $25,484     $23,987    
  Nonperforming loans / portfolio loans, net of government guarantees   1.67   %   1.88   %   1.69   %
  Nonperforming assets / total assets, net of government guarantees   1.54   %   1.68   %   1.63   %
             
  Performing restructured loans $1,645     $3,368     $9,096    
  Nonperforming loans plus performing restructured loans, net of government            
  guarantees $18,586     $21,846     $25,404    
  Nonperforming loans plus performing restructured loans / portfolio loans, net of            
  government guarantees   1.83   %   2.22   %   2.63   %
  Nonperforming assets plus performing restructured loans / total assets, net of            
  government guarantees   1.64   %   1.90   %   2.25   %
             
  Adversely classified loans, net of government guarantees $25,016     $27,080     $33,178    
  Loans 30-89 days past due and accruing, net of government guarantees /            
  portfolio loans   0.70   %   0.36   %   0.18   %
             
  Allowance for loan losses / portfolio loans   2.02   %   2.06   %   2.08   %
  Allowance for loan losses / nonperforming loans, net of government guarantees   121   %   109   %   123   %
             
  Gross loan charge-offs for the quarter $68     $109     $100    
  Gross loan recoveries for the quarter ($77 )   ($49 )   ($59 )  
  Net loan (recoveries) charge-offs for the quarter ($9 )   $60     $41    
  Net loan charge-offs year-to-date $51     $60     $1,053    
  Net loan (recoveries) charge-offs for the quarter / average loans, for the quarter   0.00   %   0.01   %     %
  Net loan charge-offs year-to-date / average loans,            
  year-to-date annualized   0.01   %   0.02   %   0.22   %

Additional Financial Information
(Dollars in thousands)
(Unaudited)

Nonperforming Assets Rollforward              
  Balance at March 31, 2019 Additions this quarter Payments this quarter Writedowns
/Charge-offs
 this quarter
Transfers to
OREO/ REPO
Transfers to Performing Status
this quarter
Sales this quarter Balance at June 30, 2019
Commercial loans $12,457   $405   ($1,591 ) ($64 ) $—   $—   $—   $11,207  
Commercial real estate   4,230     1,087     (276 )                   5,041  
Construction loans   2,423         (931 )                   1,492  
Consumer loans   406     97     (159 )   (4 )               340  
Non-performing loans guaranteed by government   (1,038 )   (101 )                       (1,139 )
  Total non-performing loans   18,478     1,488     (2,957 )   (68 )               16,941  
Other real estate owned   7,043                             7,043  
Repossessed assets   1,242                         (60 )   1,182  
Other real estate owned guaranteed                
by government   (1,279 )                           (1,279 )
  Total non-performing assets,                
  net of government guarantees $25,484   $1,488   ($2,957 ) ($68 ) $—   $—   ($60 ) $23,887  

The following table details loan charge-offs, by industry:

Loan Charge-offs by Industry        
  Three Months Ended
  June 30, 2019 March 31, 2019 December 31, 2018 September 30, 2018 June 30, 2018
Charge-offs:          
Remediation services $—   $89   $—   $—   $—  
Transportation and warehousing           362          
Other services                   78  
Excavation and construction       20     320          
Health care and social assistance   64                  
Consumer   4         31     9     22  
  Total charge-offs $68   $109   $713   $9   $100  

Additional Financial Information
(Dollars in thousands)
(Unaudited)

Average Balances, Yields, and Rates                
  Three Months Ended
  June 30, 2019   March 31, 2019   June 30, 2018
    Average     Average     Average
  Average Tax Equivalent   Average Tax Equivalent   Average Tax Equivalent
  Balance Yield/Rate   Balance Yield/Rate   Balance Yield/Rate
Assets                
Interest bearing deposits in other banks $22,850   2.34 %   $24,199   2.36 %   $35,846   1.75 %
Portfolio investments   281,450   2.71 %     280,419   2.65 %     287,003   2.09 %
Loans held for sale   51,280   4.13 %     31,203   4.52 %     48,608   4.32 %
Portfolio loans   1,003,019   5.96 %     988,920   6.04 %     963,724   5.65 %
  Total interest-earning assets   1,358,599   5.17 %     1,324,741   5.23 %     1,335,181   4.74 %
Nonearning assets   167,414         162,241         145,520    
  Total assets $1,526,013       $1,486,982       $1,480,701    
                 
Liabilities and Shareholders' Equity                
Interest-bearing deposits $818,122   0.58 %   $800,488   0.48 %   $818,592   0.22 %
Borrowings   44,938   1.53 %     51,515   1.32 %     44,897   1.40 %
  Total interest-bearing liabilities   863,060   0.63 %     852,003   0.53 %     863,489   0.28 %
                 
Noninterest-bearing demand deposits   421,232         394,024         399,311    
Other liabilities   31,391         31,710         19,626    
Shareholders' equity   210,330         209,245         198,275    
  Total liabilities and shareholders' equity $1,526,013       $1,486,982       $1,480,701    
  Net spread   4.54 %     4.70 %     4.46 %
  NIM   4.71 %     4.83 %     4.50 %
  NIMTE*   4.77 %     4.89 %     4.56 %
  Average portfolio loans to average                
  interest-earning assets   73.83 %       74.65 %       72.18 %  
  Average portfolio loans to average total deposits   80.93 %       82.79 %       79.13 %  
  Average non-interest deposits to average                
  total deposits   33.99 %       32.99 %       32.79 %  
  Average interest-earning assets to average                
  interest-bearing liabilities   157.42 %       155.49 %       154.63 %  

The components of the change in NIMTE* are detailed in the table below:

  2Q19 vs. 1Q19 2Q19 vs. 2Q18
Nonaccrual interest adjustments 0.01 % (0.01 )%
Interest rates and loan fees (0.13 )% 0.15 %
Volume and mix of interest-earning assets and liabilities % 0.07 %
Change in NIMTE* (0.12 )% 0.21 %

Additional Financial Information
(Dollars in thousands)
(Unaudited)

Average Balances, Yields, and Rates          
  Year-to-date
  June 30, 2019   June 30, 2018
    Average     Average
  Average Tax Equivalent   Average Tax Equivalent
  Balance Yield/Rate   Balance Yield/Rate
Assets          
Interest bearing deposits in other banks $23,521   2.35 %   $41,977   1.63 %
Portfolio investments   280,937   2.68 %     300,476   1.96 %
Loans held for sale   41,297   4.28 %     41,594   4.07 %
Portfolio loans   996,009   6.00 %     959,743   5.59 %
  Total interest-earning assets   1,341,764   5.20 %     1,343,790   4.61 %
Nonearning assets   164,841         143,565    
  Total assets $1,506,605       $1,487,355    
           
Liabilities and Shareholders' Equity          
Interest-bearing deposits $809,354   0.53 %   $824,038   0.20 %
Borrowings   48,208   1.42 %     45,577   1.39 %
  Total interest-bearing liabilities   857,562   0.58 %     869,615   0.26 %
           
Noninterest-bearing demand deposits   407,703         401,742    
Other liabilities   31,550         19,105    
Shareholders' equity   209,790         196,893    
  Total liabilities and shareholders' equity $1,506,605       $1,487,355    
  Net spread   4.62 %     4.35 %
  NIM   4.77 %     4.39 %
  NIMTE*   4.83 %     4.44 %
  Average portfolio loans to average interest-earning assets   74.23 %       71.42 %  
  Average portfolio loans to average total deposits   81.84 %       78.30 %  
  Average non-interest deposits to average total deposits   33.50 %       32.77 %  
  Average interest-earning assets to average interest-bearing liabilities   156.46 %       154.53 %  

The components of the change in NIMTE* are detailed in the table below:

  YTD19 vs.YTD18
Nonaccrual interest adjustments (0.01 )%
Interest rates and loan fees 0.29 %
Volume and mix of interest-earning assets and liabilities 0.11 %
Change in NIMTE* 0.39 %

Additional Financial Information
(Dollars in thousands, except per share data)
(Unaudited)

Capital Data (At quarter end)            
  June 30, 2019   March 31, 2019   June 30, 2018  
Book value per share $30.66     $30.36     $29.02    
Tangible book value per share* $28.27     $28.01     $26.66    
Total shareholders' equity/total assets   13.29   %   13.74   %   13.56   %
Tangible Common Equity/Tangible Assets*   12.38   %   12.81   %   12.60   %
Tier 1 Capital / Risk Adjusted Assets   15.03   %   15.60   %   15.10   %
Total Capital / Risk Adjusted Assets   16.28   %   16.86   %   16.35   %
Tier 1 Capital / Average Assets   13.22   %   13.86   %   13.23   %
Shares outstanding   6,729,456       6,878,829       6,872,959    
Unrealized gain (loss) on AFS debt securities, net of income taxes $871     ($59 )   ($1,506 )  
Unrealized gain (loss) on derivatives and hedging activities ($374 )   $214     $805    


Profitability Ratios                    
  June 30, 2019   March 31, 2019   December 31, 2018   September 30, 2018   June 30, 2018  
For the quarter:                    
  NIM 4.71   % 4.83   % 4.71   % 4.69   % 4.50   %
  NIMTE* 4.77   % 4.89   % 4.76   % 4.74   % 4.56   %
  Efficiency ratio 77.58   % 73.23   % 76.64   % 73.82   % 71.19   %
  Return on average assets 1.12   % 1.18   % 1.27   % 1.40   % 1.58   %
  Return on average equity 8.13   % 8.36   % 9.30   % 10.27   % 11.79   %


  June 30, 2019   June 30, 2018  
Year-to-date:        
  NIM 4.77 %     4.39 %    
  NIMTE* 4.83 %     4.44 %    
  Efficiency ratio 75.51 %     74.10 %    
  Return on average assets 1.15 %     1.34 %    
  Return on average equity 8.24 %     10.13 %    

*Non-GAAP Financial Measures
(Dollars and shares in thousands, except per share data)
(Unaudited)

Net interest margin on a tax equivalent basis

Net interest margin on a tax equivalent basis ("NIMTE") is a non-GAAP performance measurement in which interest income on non-taxable investments and loans is presented on a tax equivalent basis using a combined federal and state statutory rate of 28.43% in 2019 and 2018, respectively. The most comparable GAAP measure is net interest margin and the following table sets forth the reconciliation of NIMTE to net interest margin.

  Three Months Ended
  June 30, 2019   March 31, 2019   December 31, 2018   September 30, 2018   June 30, 2018
Net interest income $15,957     $15,769     $16,137     $15,819     $14,989  
Divided by average interest-bearing assets   1,358,599       1,324,741       1,359,909       1,338,219       1,335,181  
Net interest margin ("NIM")2   4.71 %     4.83 %     4.71 %     4.69 %     4.50 %
                   
Net interest income $15,957     $15,769     $16,137     $15,819     $14,989  
Plus: reduction in tax expense related to                  
  tax-exempt interest income   191       188       196       182       175  
  $16,148     $15,957     $16,333     $16,001     $15,164  
Divided by average interest-bearing assets   1,358,599       1,324,741       1,359,909       1,338,219       1,335,181  
NIMTE2   4.77 %     4.89 %     4.76 %     4.74 %     4.56 %


  Year-to-date
  June 30, 2019   June 30, 2018
Net interest income $31,726     $29,252  
Divided by average interest-bearing assets   1,341,764       1,343,790  
Net interest margin ("NIM")3   4.77 %     4.39 %
       
Net interest income $31,726     $29,252  
Plus: reduction in tax expense related to      
  tax-exempt interest income   379       348  
  $32,105     $29,600  
Divided by average interest-bearing assets   1,341,764       1,343,790  
NIMTE3   4.83 %     4.44 %

2Calculated using actual days in the quarter divided by 365 for quarters ended in 2019 and 2018.

3Calculated using actual days in the year divided by 365 for year-to-date periods in 2019 and 2018.

*Non-GAAP Financial Measures
(Dollars and shares in thousands, except per share data)
(Unaudited)

Tangible Book Value

Tangible book value is a non-GAAP measure defined as shareholders' equity, less intangible assets, divided by shares outstanding.  The following table sets forth the reconciliation of tangible book value per share and book value per share.

  June 30, 2019   March 31, 2019   December 31, 2018   September 30, 2018   June 30, 2018
                   
Total shareholders' equity $206,338     $208,838     $205,947     $203,242     $199,456  
Divided by shares outstanding   6,729       6,879       6,883       6,884       6,873  
Book value per share $30.66     $30.36     $29.92     $29.52     $29.02  


  June 30, 2019   March 31, 2019   December 31, 2018   September 30, 2018   June 30, 2018
                   
Total shareholders' equity $206,338     $208,838     $205,947     $203,242     $199,456  
Less: goodwill and intangible assets   16,124       16,139       16,154       16,171       16,189  
  $190,214     $192,699     $189,793     $187,071     $183,267  
Divided by shares outstanding   6,729       6,879       6,883       6,884       6,873  
Tangible book value per share $28.27     $28.01     $27.57     $27.17     $26.66  

Tangible Common Equity to Tangible Assets

Tangible common equity to tangible assets is a non-GAAP ratio that represents total equity less goodwill and intangible assets divided by total assets less goodwill and intangible assets. This ratio has received more attention over the past several years from stock analysts and regulators.  The most comparable GAAP measure of shareholders' equity to total assets is calculated by dividing total shareholders' equity by total assets.

Northrim BanCorp, Inc.

 
June 30, 2019   March 31, 2019   December 31, 2018   September 30, 2018   June 30, 2018
                   
Total shareholders' equity $206,338     $208,838     $205,947     $203,242     $199,456  
Total assets   1,552,770       1,520,051       1,502,988       1,502,673       1,470,440  
Total shareholders' equity to total assets   13.29 %     13.74 %     13.70 %     13.53 %     13.56 %


Northrim BanCorp, Inc.

 
June 30, 2019   March 31, 2019   December 31, 2018   September 30, 2018   June 30, 2018
Total shareholders' equity $206,338     $208,838     $205,947     $203,242     $199,456  
Less: goodwill and other intangible assets, net   16,124       16,139       16,154       16,171       16,189  
Tangible common shareholders' equity $190,214     $192,699     $189,793     $187,071     $183,267  
                   
Total assets $1,552,770     $1,520,051     $1,502,988     $1,502,673     $1,470,440  
Less: goodwill and other intangible assets, net   16,124       16,139       16,154       16,171       16,189  
Tangible assets $1,536,646     $1,503,912     $1,486,834     $1,486,502     $1,454,251  
Tangible common equity ratio   12.38 %     12.81 %     12.76 %     12.58 %     12.60 %


Contact: Joe Schierhorn,  President, CEO, and COO
  (907) 261-3308
  Jed Ballard, Chief Financial Officer
  (907) 261-3539

 

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