Northwest Bancshares Inc..’s net income for the fourth quarter of 2020 increased $9.5 million from the same quarter in 2019, according to recently released financial statements.

Net income for the quarter ended Dec. 31, 2020, was $35.1 million, or 28 cents per diluted share. This represents an increase of $9.5 million, or 37%, compared to the same quarter in 2019 when net income was $25.6 million, or 24 cents per diluted share. The annualized returns on average shareholders’ equity and average assets for the quarter ended December 31, 2020, were 9% and 1.01% compared to 7.52% and .97% for the same quarter last year.

Northwest also announced that its Board of Directors declared a quarterly cash dividend of 19 cents per share payable on Feb. 15 to shareholders of record as of Feb. 4. This is the 105th consecutive quarter in which the company has paid a cash dividend.

“We are extremely proud that we were able to maintain our dividend throughout 2020 despite the challenges of COVID-19 on bank earnings,” said Ronald J. Seiffert, Northwest chairman, president and CEO. “Based on the current market value of the company’s stock, this represents an annualized dividend yield of approximately 5.50%, which continues to be among the highest in our peer group.”

Net interest income increased by $13.9 million, or 15.7%, to $102.9 million for the quarter ended December 31, 2020, from $88.9 million for the quarter ended December 31, 2019, primarily due to a $7.8 million, or 8.%, increase in interest income on loans receivable and a $6.2 million, or 47.9%, decrease in interest expense on deposits. The increase in interest income was primarily due to an increase of $1.935 billion, or 22.2%, in the average balance of loans which more than offset the decline experienced from a reduction in the yield on loans to 3.97% for the quarter ended Dec. 31, 2020, from 4.47% for the same quarter last year.

The decrease in interest expense was primarily due to a decrease in our interest-bearing cost of deposits to .30% for the quarter ended Dec. 31, 2020, from .75% for the quarter ended Dec. 31, 2019, which was partially offset by the growth in the average balance of interest-bearing deposits by $1.991 billion, or 29.1%. The net impact of these changes caused the company’s net interest margin to decrease to 3.26% for the quarter ended December 31, 2020 from 3.73% for the same quarter last year.

“When looking back over a very challenging 2020, I am amazed at what our team accomplished during the midst of COVID-19,” Seiffert said. “We successfully adopted CECL in the first quarter followed closely by the close and conversion of MutualBank on April 24th, the largest acquisition in the company’s history. We also completed a very successful $125 million sub-debt offering in September. This additional liquidity and capital at the holding company allowed us to resume our existing five million share common stock buyback program, of which we successfully repurchased approximately 760,000 shares in the fourth quarter at an average price of $12.20. Finally, we completed our branch optimization program which resulted in the consolidation of 43 offices in December 2020. In addition to all of these initiatives, we will be launching our digital strategy this year which will significantly enhance our online banking capabilities and streamline our account opening processes. We want to give our customers the same award winning experience online as they are accustomed to receiving in our branch offices. In addition, we are expanding our capabilities in mortgage banking to all of our markets and expanding our geographic footprint for dealer services’ indirect auto and power sports lending. We have acquired talent to enhance our treasury management services, added resources to our corporate finance capabilities, created a healthcare vertical with a dedicated subject matter expert and will be opening a Loan Production Office in the greater Philadelphia market with the addition of a team of capable middle market bankers. As rewarding as 2020 was, we are even more optimistic about 2021.”

Headquartered in Warren, Northwest Bancshares Inc. is the holding company of Northwest Bank.