First Northwest Bancorp (FNWB) investor relations material

Executive summary

• Net income for Q1 2026 was $6,000, a recovery from a $9.0 million loss in Q1 2025 but a sharp decline from $382,000 in Q4 2025, with diluted EPS of $0.00.

• Management is focused on process efficiency, core deposit growth, organic loan expansion, and operational efficiency to drive sustainable profitability.

• Profitability is expected to improve in the second half of 2026 and continue into 2027 as cost and balance sheet initiatives take effect.

• Total assets increased 1.2% to $2.13 billion at March 31, 2026, with cash and cash equivalents up 22.3% to $104.1 million.

• Loan portfolio remained stable at $1.61 billion, with growth in commercial business and consumer loans offsetting declines in residential and multifamily loans.

Financial highlights

• Net interest margin expanded for the sixth consecutive quarter to 3.03%, up from 3.00% in Q4 2025 and 2.76% in Q1 2025.

• Cost of deposits declined 8 bps to 2.04% quarter-over-quarter.

• Gross loans decreased by $1.3 million (0.08%) to $1.63 billion; customer deposits rose $24.9 million (1.64%).

• Brokered deposits fell $22.4 million (25.88%) sequentially and $73.8 million year-over-year.

• Noninterest expense decreased $3.3 million year-over-year to $16.7 million, with prior year including a $5.8 million legal settlement.

• Allowance for credit losses on loans (ACLL) was $16.8 million (1.03% of loans), down from $17.0 million at year-end.

Outlook and guidance

• Near-term results expected to remain uneven as transformation progresses, but profitability is anticipated to improve in 2H26 and continue into 2027.

• $445,000 in interest expense savings expected over the next nine months from repricing time deposits.

• Management continues to monitor economic conditions and expects the investment portfolio to provide supplemental income and liquidity.