FNWD · Finward Bancorp

Finward Bancorp's first quarter 2026 results showed improved profitability with net income rising to $2.2 million or $0.52 per diluted share from $2.0 million or $0.46 in the prior quarter, driven by net interest margin expansion to 3.35% on a tax-equivalent basis from 3.32%. This improvement stemmed primarily from a favorable reduction in funding costs, despite a slight decline in deposits to $1.72 billion from $1.73 billion. Non-interest-bearing deposits grew by $11.3 million to $278.7 million, supporting liquidity, while core deposits held steady at $1.2 billion. The loan portfolio remained flat at $1.45 billion, with $37.4 million in new commercial loan originations amid seasonal patterns. Credit quality ticked up modestly, with non-performing loans increasing to $12.4 million or 0.85% of total loans from 0.77%, but coverage remains solid at 139.7% via the $17.3 million allowance for credit losses. A minimal $55 thousand net provision was recorded, reflecting loan segment reductions and modeling factors, alongside net recoveries of $3 thousand. Non-interest income improved to 0.48% of average assets from 0.29%, boosted by the absence of prior quarter's $1.6 million securities sale losses, while expenses edged lower due to reduced data processing and occupancy costs. Efficiency ratio improved to 84.45% from 89.50%. CEO Benjamin Bochnowski highlighted progress in profitability, loan pipeline growth, and margin expansion, alongside branch closures for efficiency and healthy credit positioning. Capital ratios strengthened, with Tier 1 leverage at 9.24% versus 8.93%, exceeding regulatory requirements.