• First Western Reports First Quarter 2024 Financial Results

    ソース: Nasdaq GlobeNewswire / 18 4 2024 17:26:20   America/New_York

    First Quarter 2024 Summary

    • Net income available to common shareholders of $2.5 million in Q1 2024, compared to a Net loss of $3.2 million in Q4 2023.
    • Diluted earnings/(loss) per share of $0.26 in Q1 2024, compared to $(0.34) in Q4 2023
    • Non-interest income increased 19.7% to $7.3 million compared to $6.1 million in Q4 2023 and 25.3% compared to $5.8 million in Q1 2023
    • Loan to deposit ratio decreased to 98.4% in Q1 2024, compared to 100.6% in Q4 2023
    • Book value per common share increased 0.8% from $25.33 in Q4 2023 to $25.52 in Q1 2024. Tangible book value per common share(1) increased 0.9% from $22.01 in Q4 2023, to $22.21 in Q1 2024.
    • Total capital to risk-weighted assets ratio of 13.15% in Q1 2024, compared to 12.59% in Q4 2023

    DENVER, April 18, 2024 (GLOBE NEWSWIRE) -- First Western Financial, Inc. (“First Western” or the “Company”) (NASDAQ: MYFW), today reported financial results for the first quarter ended March 31, 2024.

    Net income available to common shareholders was $2.5 million, or $0.26 per diluted share, for the first quarter of 2024. This compares to Net loss of $3.2 million, or $(0.34) per diluted share, for the fourth quarter of 2023, and Net income of $3.8 million, or $0.39 per diluted share, for the first quarter of 2023.

    Scott C. Wylie, CEO of First Western, commented, "While continuing to prioritize prudent risk management and a conservative approach to new loan production, we delivered a higher level of profitability during the first quarter compared to Q4 2023. As a result of strong execution on our strategic priorities, we saw positive trends in a number of key areas including further improvement in our loan-to-deposit ratio, a higher level of non-interest income driven by our wealth management and mortgage banking businesses, and improvement in our asset quality with a decline in non-performing loans and net charge-offs to average loans of 0.00% in the quarter. Given our higher level of profitability and prudent balance sheet management, we were able to continue increasing our tangible book value per share and our risk-based capital ratios.

    “While economic conditions remain uncertain, we will continue to prioritize prudent risk management and be conservative in new loan production, while focusing on adding new full banking relationships with high quality clients that need the multiple products and services we can provide in banking, wealth management, and other areas. When economic conditions improve, given the strength of our balance sheet, including the higher level of liquidity that we now have, we believe we are well positioned to capitalize on increased loan demand to grow our balance sheet, increase revenue, and realize more operating leverage, which should result in further increases in our level of profitability and additional value being created for shareholders,” said Mr. Wylie.

     For the Three Months Ended
     March 31, December 31, March 31,
    (Dollars in thousands, except per share data)2024
     2023
     2023
    Earnings Summary     
    Net interest income$16,070  $16,331  $19,573 
    Provision/(release) for credit losses 72   8,493   (310)
    Total non-interest income 7,277   6,081   5,806 
    Total non-interest expense 19,696   18,276   20,528 
    Income/(loss) before income taxes 3,579   (4,357)  5,161 
    Income tax expense/(benefit) 1,064   (1,138)  1,341 
    Net income/(loss) available to common shareholders 2,515   (3,219)  3,820 
    Basic earnings/(loss) per common share 0.26   (0.34)  0.40 
    Diluted earnings/(loss) per common share 0.26   (0.34)  0.39 
          
    Return on average assets (annualized) 0.35%  (0.45)%  0.54%
    Return on average shareholders' equity (annualized) 4.10   (5.17)  6.40 
    Return on tangible common equity (annualized)(1) 4.71   (6.11)  7.35 
    Net interest margin 2.34   2.37   2.93 
    Efficiency ratio(1) 83.44   80.93   78.44 

    ____________________

    (1) Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure.

    Operating Results for the First Quarter 2024

    Revenue

    Total income before non-interest expense was $23.3 million for the first quarter of 2024, an increase of 67.2%, compared to $13.9 million for the fourth quarter of 2023. Gross revenue(1) was $23.5 million for the first quarter of 2024, an increase of 4.6%, from $22.5 million for the fourth quarter of 2023. The increase in Total income before non-interest expense was primarily driven by a decrease in Provision for credit losses. Relative to the first quarter of 2023, Total income before non-interest expense decreased 9.4% from $25.7 million. Gross revenue decreased 9.8% from $26.1 million for the first quarter of 2023. The decrease was driven by a decrease in Net interest income as a result of higher Interest expense due to higher deposit costs, offset partially by higher Interest income.

    (1) Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP 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 2024 was $16.1 million, a decrease of 1.6% from $16.3 million in the fourth quarter of 2023. Relative to the first quarter of 2023, Net interest income decreased 17.9% from $19.6 million. The decreases were due to higher Interest expense driven primarily by higher deposit costs, offset partially by higher Interest income.

    Net Interest Margin

    Net interest margin for the first quarter of 2024 decreased 3 basis points to 2.34% from 2.37% reported in the fourth quarter of 2024, primarily due to continued pricing pressure on interest-bearing deposits and an unfavorable mix shift in the deposit portfolio.

    The yield on interest-earning assets increased 7 basis points to 5.58% in the first quarter of 2024 from 5.51% in the fourth quarter of 2023 and the cost of interest-bearing deposits increased 19 basis points to 4.13% in the first quarter of 2024 from 3.94% in the fourth quarter of 2023.

    Relative to the first quarter of 2023, net interest margin decreased from 2.93%, primarily due to pricing pressure on interest-bearing deposits and an unfavorable mix shift in the deposit portfolio.

    Non-interest Income

    Non-interest income for the first quarter of 2024 was $7.3 million compared to $6.1 million in the fourth quarter of 2023, primarily driven by an increase in Net gain on mortgage loans and higher Bank fees during the first quarter of 2024, partially offset by lower Risk management and insurance fees, which tend to be seasonally higher in the fourth quarter.

    Relative to the first quarter of 2023, Non-interest income increased 25.3% from $5.8 million. Increases were driven by most components of Non-interest income, including Bank fees, Net gain on loans held for sale, Trust and investment management fees, Net gain on mortgage loans, and Net gain on loans accounted for under the fair value option.

    Non-interest Expense

    Non-interest expense for the first quarter of 2024 was $19.7 million compared to $18.3 million for the fourth quarter of 2023. The increase was driven by higher Salaries and employee benefits due to a higher bonus accrual commensurate with improved earnings in the first quarter of 2024 as compared to the fourth quarter of 2023 and higher payroll taxes, which tend to be seasonally higher in the first quarter.

    Relative to the first quarter of 2023, Non-interest expense decreased 4.1% from $20.5 million, driven primarily by lower Salaries and employee benefits as a result of staffing reductions in 2023 to better align expenses with lower revenue. The decrease was partially offset by increased Professional services and Other operational costs related to higher legal, audit and other professional fees.

    The Company’s efficiency ratio(1) was 83.4% in the first quarter of 2024, compared with 80.9% in the fourth quarter of 2023 and 78.4% in the first quarter of 2023.

    (1) Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP 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 $1.1 million for the first quarter of 2024, compared to Income tax benefit of $1.1 million for the fourth quarter of 2023 and Income tax expense of $1.3 million for the first quarter of 2023.

    Loans

    Total loans held for investment were $2.48 billion as of March 31, 2024, a decrease of 2.2% from $2.54 billion as of December 31, 2023, the decline was due to a net decrease in Commercial and Industrial and 1-4 Family Residential portfolios. Relative to the first quarter of 2023, Total loans held for investment were flat year over year at $2.48 billion as of March 31, 2023.

    Deposits

    Total deposits were $2.53 billion as of March 31, 2024, which were flat compared to December 31, 2023. Relative to the first quarter of 2023, Total deposits increased 5.9% from $2.39 billion as of March 31, 2023, driven primarily by Interest-bearing deposits due to new and expanded deposit relationships.

    Borrowings

    Federal Home Loan Bank (“FHLB”) and Federal Reserve borrowings were $69.5 million as of March 31, 2024, a decrease of $56.2 million from $125.7 million as of December 31, 2023. Relative to the first quarter of 2023, borrowings decreased $191.9 million from $261.4 million as of March 31, 2023. The change in borrowings from December 31, 2023 and March 31, 2023 is driven by a $31.0 million repayment of a Bank Term Funding Program loan that matured in March 2024. The change when compared to March 31, 2023 was also driven by a decline in FHLB borrowing reliance as a result of increased deposits.

    Subordinated notes were $52.4 million as of March 31, 2024, compared to $52.3 million as of December 31, 2023. Subordinated notes increased $0.2 million from $52.2 million as of March 31, 2023.

    Assets Under Management

    Assets Under Management ("AUM") increased by $388.5 million during the first quarter to $7.14 billion as of March 31, 2024, compared to $6.75 billion as of December 31, 2023. This increase was primarily attributable to an increase in market values throughout the first quarter of 2024, resulting in an increase in the value of AUM balances. Total AUM increased by $759.4 million compared to March 31, 2023 from $6.38 billion, which was primarily attributable to improving market conditions year-over-year resulting in an increase in the value of AUM.

    Credit Quality

    Non-performing assets totaled $46.0 million, or 1.57% of total assets, as of March 31, 2024, compared to $51.1 million, or 1.72% of total assets, as of December 31, 2023. The decrease is primarily due to the sale of a non-performing Construction and Development note at a gain, a large principal payment received on a Cash, securities and other note offset partially by one new Non-performing Commercial and Industrial loan. As of March 31, 2023, non-performing assets totaled $12.5 million, or 0.42% of total assets. Relative to the first quarter of 2023, the increase in non-performing assets was due to the net addition of $33.5 million in loans added throughout 2023.

    During the first quarter of 2024 the Company recorded a provision expense of $0.1 million, compared to a provision expense of $8.5 million in the fourth quarter of 2023 and a $0.3 million release to its provision in the first quarter of 2023. The decrease in provision expense recorded in the first quarter of 2024 compared to fourth quarter of 2023 reflects a Commercial and Industrial loan where the borrower filed for bankruptcy resulting in a charge-off of the entire loan balance during the fourth quarter of 2023.

    Capital

    As of March 31, 2024, First Western (“Consolidated”) and First Western Trust Bank (“Bank”) exceeded the minimum capital levels required by their respective regulators. As of March 31, 2024, the Bank was classified as “well capitalized,” as summarized in the following table:

     March 31,
     2024
    Consolidated Capital 
    Tier 1 capital to risk-weighted assets9.77%
    Common Equity Tier 1 ("CET1") to risk-weighted assets9.77 
    Total capital to risk-weighted assets13.15 
    Tier 1 capital to average assets7.73 
      
    Bank Capital 
    Tier 1 capital to risk-weighted assets11.00 
    CET1 to risk-weighted assets11.00 
    Total capital to risk-weighted assets12.02 
    Tier 1 capital to average assets8.70 
       

    Book value per common share increased 0.8% from $25.33 as of December 31, 2023 to $25.52 as of March 31, 2024. Book value per common share increased 1.2% from $25.22 as of March 31, 2023.

    Tangible book value per common share(1) increased 0.9% from $22.01 as of December 31, 2023, to $22.21 as of March 31, 2024. Tangible book value per common share increased 1.5% from $21.85 as of March 31, 2023.

    (1) Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP 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 19, 2024. Telephone access: https://register.vevent.com/register/BId5870626426740ff9c585b6c315ea36c.

    A slide presentation relating to the fourth quarter 2024 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 investment securities; the risk of changes in interest rates; and the risk of the adequacy of our allowance for credit losses and the risk in our ability to maintain a strong core deposit base or other low-cost funding sources. 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 15, 2024 (“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 ConsolidatedStatements of Income (unaudited)
      
     Three Months Ended
     March 31, December 31, March 31,
    (Dollars in thousands, except per share amounts)2024 2023 2023
    Interest and dividend income:     
    Loans, including fees$35,139  $35,625  $32,080 
    Loans accounted for under the fair value option 209   257   427 
    Investment securities 603   600   629 
    Interest-bearing deposits in other financial institutions 2,352   1,350   1,403 
    Dividends, restricted stock 95   161   173 
    Total interest and dividend income 38,398   37,993   34,712 
          
    Interest expense:     
    Deposits 20,622   19,037   13,092 
    Other borrowed funds 1,706   2,625   2,047 
    Total interest expense 22,328   21,662   15,139 
    Net interest income 16,070   16,331   19,573 
    Less: provision/(release) for credit losses 72   8,493   (310)
    Net interest income, after provision/(release) for credit losses 15,998   7,838   19,883 
          
    Non-interest income:     
    Trust and investment management fees 4,930   4,705   4,635 
    Net gain on mortgage loans 1,264   379   1,019 
    Net gain/(loss) on loans held for sale 117      (178)
    Bank fees 891   412   592 
    Risk management and insurance fees 49   544   127 
    Income on company-owned life insurance 105   101   90 
    Net loss on loans accounted for under the fair value option (302)  (91)  (543)
    Unrealized (loss)/gain recognized on equity securities (6)  (2)  10 
    Other 229   33   54 
    Total non-interest income 7,277   6,081   5,806 
    Total income before non-interest expense 23,275   13,919   25,689 
          
    Non-interest expense:     
    Salaries and employee benefits 11,267   9,988   13,098 
    Occupancy and equipment 1,976   1,937   1,914 
    Professional services 2,411   1,990   1,923 
    Technology and information systems 1,010   928   832 
    Data processing 948   1,189   1,139 
    Marketing 194   415   391 
    Amortization of other intangible assets 57   62   64 
    Other 1,833   1,767   1,167 
    Total non-interest expense 19,696   18,276   20,528 
    Income/(loss) before income taxes 3,579   (4,357)  5,161 
    Income tax (benefit)/expense 1,064   (1,138)  1,341 
    Net income/(loss) available to common shareholders$2,515  $(3,219) $3,820 
    Earnings/(loss) per common share:     
    Basic$0.26  $(0.34) $0.40 
    Diluted 0.26   (0.34)  0.39 
                


    First Western Financial, Inc.
    CondensedConsolidatedBalance Sheets (unaudited)
          
     March 31, December 31, March 31,
    (Dollars in thousands)2024 2023 2023
    Assets     
    Cash and cash equivalents:     
    Cash and due from banks$8,136  $7,284  $6,920 
    Interest-bearing deposits in other financial institutions 249,753   247,158   288,147 
    Total cash and cash equivalents 257,889   254,442   295,067 
          
    Held-to-maturity securities (fair value of $64,908, $66,617 and $73,570, respectively), net of allowance for credit losses of $71 72,303   74,102   79,565 
    Correspondent bank stock, at cost 4,461   7,155   13,222 
    Mortgage loans held for sale, at fair value 10,470   7,254   9,873 
    Loans (includes $11,922, $13,726, and $20,807 measured at fair value, respectively) 2,475,524   2,530,915   2,469,038 
    Allowance for credit losses (24,630)  (23,931)  (19,843)
    Loans, net 2,450,894   2,506,984   2,449,195 
    Premises and equipment, net 24,869   25,256   25,383 
    Accrued interest receivable 11,919   11,428   10,976 
    Accounts receivable 4,980   5,095   4,713 
    Other receivables 5,254   4,467   2,396 
    Goodwill and other intangible assets, net 31,797   31,854   32,040 
    Deferred tax assets, net 5,695   6,407   6,792 
    Company-owned life insurance 16,635   16,530   16,242 
    Other assets 35,051   24,488   23,043 
    Total assets$2,932,217  $2,975,462  $2,968,507 
          
    Liabilities     
    Deposits:     
    Noninterest-bearing$434,236  $482,579  $545,064 
    Interest-bearing 2,097,734   2,046,460   1,846,863 
    Total deposits 2,531,970   2,529,039   2,391,927 
    Borrowings:     
    Federal Home Loan Bank and Federal Reserve borrowings 69,484   125,711   261,385 
    Subordinated notes 52,397   52,340   52,167 
    Accrued interest payable 2,415   3,793   1,786 
    Other liabilities 30,423   21,841   21,420 
    Total liabilities 2,686,689   2,732,724   2,728,685 
          
    Shareholders’ Equity     
    Total shareholders’ equity 245,528   242,738   239,822 
    Total liabilities and shareholders’ equity$2,932,217  $2,975,462  $2,968,507 
                


    First Western Financial, Inc.
    Consolidated Financial Summary (unaudited)
          
     March 31, December 31, March 31,
    (Dollars in thousands)2024 2023 2023
    Loan Portfolio     
    Cash, Securities, and Other(1)$151,178  $140,053  $157,308 
    Consumer and Other 18,556   27,446   22,183 
    Construction and Development 333,284   347,515   283,999 
    1-4 Family Residential 910,129   925,984   889,782 
    Non-Owner Occupied CRE 562,862   546,966   536,679 
    Owner Occupied CRE 194,338   197,205   223,449 
    Commercial and Industrial 297,573   336,842   340,632 
    Total 2,467,920   2,522,011   2,454,032 
    Loans accounted for under the fair value option 12,276   14,129   21,052 
    Total loans held for investment 2,480,196   2,536,140   2,475,084 
    Deferred (fees) costs and unamortized premiums/(unaccreted discounts), net(2) (4,672)  (5,225)  (6,046)
    Loans (includes $11,922, $13,726, and $20,807 measured at fair value, respectively)$2,475,524  $2,530,915  $2,469,038 
    Mortgage loans held for sale 10,470   7,254   9,873 
          
    Deposit Portfolio     
    Money market deposit accounts$1,503,598  $1,386,149  $1,277,988 
    Time deposits 442,834   496,452   354,545 
    Negotiable order of withdrawal accounts 132,415   147,488   192,011 
    Savings accounts 18,887   16,371   22,319 
    Total interest-bearing deposits 2,097,734   2,046,460   1,846,863 
    Noninterest-bearing accounts 434,236   482,579   545,064 
    Total deposits$2,531,970  $2,529,039  $2,391,927 

    ____________________
    (1) Includes PPP loans of $3.8 million as of March 31, 2024, $4.3 million as of December 31, 2023, and $6.1 million as of March 31, 2023.
    (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)2024
     2023
     2023
    Average Balance Sheets     
    Assets     
    Interest-earning assets:     
    Interest-bearing deposits in other financial institutions$177,523  $104,789  $127,608 
    Investment securities 74,666   76,331   82,106 
    Correspondent bank stock 4,451   7,576   9,592 
    Loans 2,490,300   2,521,532   2,456,922 
    Mortgage loans held for sale 6,752   9,915   7,521 
    Loans held at fair value 13,134   14,755   22,722 
    Total interest-earning assets 2,766,826   2,734,898   2,706,471 
    Allowance for credit losses (23,974)  (23,308)  (20,325)
    Noninterest-earning assets 124,144   126,132   125,201 
    Total assets$2,866,996  $2,837,722  $2,811,347 
          
    Liabilities and Shareholders’ Equity     
    Interest-bearing liabilities:     
    Interest-bearing deposits$2,008,246  $1,914,856  $1,805,994 
    FHLB and Federal Reserve borrowings 92,195   139,316   142,642 
    Subordinated notes 52,360   52,299   52,135 
    Total interest-bearing liabilities 2,152,801   2,106,471   2,000,771 
    Noninterest-bearing liabilities:     
    Noninterest-bearing deposits 446,457   456,787   545,670 
    Other liabilities 22,250   25,387   26,206 
    Total noninterest-bearing liabilities 468,707   482,174   571,876 
    Total shareholders’ equity 245,488   249,077   238,700 
    Total liabilities and shareholders’ equity$2,866,996  $2,837,722  $2,811,347 
          
    Yields/Cost of funds (annualized)     
    Interest-bearing deposits in other financial institutions 5.33%  5.11%  4.46%
    Investment securities 3.25   3.12   3.11 
    Correspondent bank stock 8.58   8.43   7.31 
    Loans 5.66   5.58   5.28 
    Loan held at fair value 6.40   6.91   7.62 
    Mortgage loans held for sale 6.79   6.60   6.04 
    Total interest-earning assets 5.58   5.51   5.20 
    Interest-bearing deposits 4.13   3.94   2.94 
    Total deposits 3.38   3.18   2.26 
    FHLB and Federal Reserve borrowings 4.23   5.36   3.89 
    Subordinated notes 5.66   5.63   5.38 
    Total interest-bearing liabilities 4.17   4.08   3.07 
    Net interest margin 2.34   2.37   2.93 
    Net interest rate spread 1.41   1.43   2.13 
                


    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)2024 2023 2023
    Asset Quality     
    Non-performing loans$46,044  $51,125  $12,460 
    Non-performing assets 46,044   51,125   12,460 
    Net charge-offs    8,595   5 
    Non-performing loans to total loans 1.86%  2.02%  0.50%
    Non-performing assets to total assets 1.57   1.72   0.42 
    Allowance for credit losses to non-performing loans 53.49   46.81   159.25 
    Allowance for credit losses to total loans 1.00   0.95   0.81 
    Allowance for credit losses to adjusted loans(1) 1.00   0.95   0.81 
    Net charge-offs to average loans    0.34   * 
          
    Assets Under Management$7,141,453  $6,752,981  $6,382,036 
          
    Market Data     
    Book value per share at period end 25.52   25.33   25.22 
    Tangible book value per common share(1) 22.21   22.01   21.85 
    Weighted average outstanding shares, basic 9,621,309   9,572,582   9,503,715 
    Weighted average outstanding shares, diluted 9,710,764   9,572,582   9,732,674 
    Shares outstanding at period end 9,621,309   9,581,183   9,507,564 
          
    Consolidated Capital     
    Tier 1 capital to risk-weighted assets 9.77%  9.40%  9.28%
    CET1 to risk-weighted assets 9.77   9.40   9.28 
    Total capital to risk-weighted assets 13.15   12.59   12.39 
    Tier 1 capital to average assets 7.73   7.77   7.75 
          
    Bank Capital     
    Tier 1 capital to risk-weighted assets 11.00   10.54   10.29 
    CET1 to risk-weighted assets 11.00   10.54   10.29 
    Total capital to risk-weighted assets 12.02   11.45   11.12 
    Tier 1 capital to average assets 8.70   8.71   8.59 

    ____________________
    (1) Represents a Non-GAAP financial measure. See “Reconciliation of Non-GAAP Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure.
    * Value results in an immaterial amount.

    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)2024
     2023
     2023
    Tangible Common     
    Total shareholders' equity$245,528  $242,738  $239,822 
    Less: goodwill and other intangibles, net 31,797   31,854   32,040 
    Tangible common equity$213,731  $210,884  $207,782 
          
    Common shares outstanding, end of period 9,621,309   9,581,183   9,507,564 
    Tangible common book value per share$22.21  $22.01  $21.85 
    Net income/(loss) available to common shareholders 2,515   (3,219)  3,820 
    Return on tangible common equity (annualized) 4.71%  (6.11)%  7.35%
          
    Efficiency     
    Non-interest expense$19,696  $18,276  $20,528 
    Less: amortization 57   62   64 
    Adjusted non-interest expense$19,639  $18,214  $20,464 
          
    Total income before non-interest expense$23,275  $13,919  $25,689 
    Less: unrealized (loss)/gain recognized on equity securities (6)  (2)  10 
    Less: net loss on loans accounted for under the fair value option (302)  (91)  (543)
    Less: net gain/(loss) on loans held for sale at fair value 117      (178)
    Plus: provision/(release) for credit losses 72   8,493   (310)
    Gross revenue$23,538  $22,505  $26,090 
    Efficiency ratio 83.44%  80.93%  78.44%
          
    Allowance for Credit Loss to Adjusted Loans     
    Total loans held for investment 2,480,196   2,536,140   2,475,084 
    Less: PPP loans 3,779   4,343   6,100 
    Less: loans accounted for under fair value 12,276   14,129   21,052 
    Adjusted loans$2,464,141  $2,517,668  $2,447,932 
          
    Allowance for credit losses$24,630  $23,931  $19,843 
    Allowance for credit losses to adjusted loans 1.00%  0.95%  0.81%

     


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