First Northwest Bancorp (FNWB): Business Model Canvas [Dec-2025 Updated]

Honestly, figuring out how a community bank like First Northwest Bancorp (FNWB) stays relevant when the giants are going digital is key for any investor. You're looking at a model that's definitely trying to walk two paths: maintaining that high-touch, local decision-making across its 16 Washington branches while aggressively integrating fintech partners for things like spend management and consumer loans. This strategy is backed by solid numbers as of Q3 2025, showing a Net Interest Margin of 2.91%, total revenue of $16.57 million, and a strong capital cushion at 13.7% risk-based capital. So, how does this hybrid approach-mixing traditional lending with digital augmentation-actually translate into revenue streams and manage costs like that $12.3 million interest expense? Dive into the full Business Model Canvas below to see the engine driving this regional player.

First Northwest Bancorp (FNWB) - Canvas Business Model: Key Partnerships

You're looking at how First Northwest Bancorp (FNWB) extends its reach and capabilities through external alliances, which is key for a regional bank aiming for modern service delivery. These aren't just vendor relationships; some involve direct investment or joint ventures.

The strategy clearly involves integrating specialized technology and accessing broader capital markets. For instance, the partnership with Splash Financial, a digital lending platform, helps FNWB develop and deploy consumer loan products nationwide. While specific 2025 loan volume through this channel isn't public, Splash Financial itself reported facilitating over $6bn in loans in total, and it secured a Series C funding round of over $70 million in September 2025, signaling continued industry momentum. This kind of fintech collaboration supports FNWB's trailing twelve-month revenue as of September 30, 2025, which stood at $66 million.

Another critical area is investment banking and accelerator services through The Meriwether Group. First Northwest Bancorp made an equity investment in The Meriwether Group back in 2022. More recently, First Fed Bank is a partner in the Meriwether Group Capital's Hero Fund. The State of Oregon committed an initial $3 million to this fund in July 2025, with an option to increase that to $5 million over the next 12 months. This positions First Northwest Bancorp to support high-growth Pacific Northwest businesses.

For wholesale funding and liquidity management, the Federal Home Loan Bank (FHLB) remains a resource, though FNWB has actively managed this liability. Management noted successfully reduced FHLB borrowings during the fourth quarter of 2024, aiming for improvement in early 2025. To give you context on the broader FHLB system's capacity, the FHLB Dallas announced its SHARE 2025 Advance Program, making up to $5 billion in advances available to members, with a maximum advance per member capped at $1 billion.

The firm also pursues direct technology integration, such as the partnership with Torpago for corporate card and spend management solutions, which included an equity investment and a line of credit to Torpago upon announcement in 2022. Similarly, FNWB entered a joint venture in 2021 to found Quin, focused on financial wellness and lifestyle protection products for consumers nationwide. These efforts align with the bank's overall strategy to deliver a full array of modern financial services.

Here's a snapshot of the key partnerships and associated quantifiable data:

The operational focus in 2025, as seen in the Q1 2025 results, included managing credit quality, where nonperforming loans totaled $26.4 million at March 31, 2025. The bank declared a quarterly cash dividend of $0.07 per common share for Q1 2025.

Key strategic elements related to these partnerships include:

• Fintech partners like Torpago for spend management solutions, where FNWB provided an equity investment and a line of credit.
• Digital lending platforms such as Splash Financial for consumer loan products, supporting the bank's national reach efforts.
• Investment in The Meriwether Group for investment banking and accelerator services, evidenced by the joint Hero Fund participation.
• Joint venture with Quin for financial wellness and lifestyle protection products, established in 2021.
• Federal Home Loan Bank (FHLB) for wholesale funding and liquidity management, with a focus on reducing reliance in 2025.

Finance: draft 13-week cash view by Friday.

First Northwest Bancorp (FNWB) - Canvas Business Model: Key Activities

You're looking at the core engine of First Northwest Bancorp (FNWB) as of late 2025. The activities here are what drive the balance sheet and the income statement, so let's look at the hard numbers from the third quarter.

Core commercial and retail deposit gathering and management

Gathering stable, core funding remains central to First Northwest Bancorp's operations. You saw a favorable shift in the deposit mix during the first quarter of 2025. Specifically, brokered deposits decreased by $45.0 million, while core customer deposits actually grew by $23.0 million in that same period. As of September 30, 2025, total deposits stood at $1.65 billion. This activity helps manage the cost of funds, which decreased to 2.67% in Q1 2025 from 2.80% in the prior quarter.

Originating real estate, commercial business, and consumer loans

The bank's lending focus is quite specific, centered on the Pacific Northwest market, though some consumer products have national reach through partnerships. The principal lending activities First Northwest Bancorp engages in include:

• First lien one- to four-family mortgage loans.
• Commercial and multi-family real estate loans.
• Construction and land loans.
• Commercial business loans.
• Consumer loans, primarily automobile loans and home-equity products.

Net loans receivable, after strategic adjustments, were reported at $1.61 billion on September 30, 2025. That represented a decrease of $39.4 million during the third quarter of 2025 alone. The loan-to-deposit ratio was stable around 99.9% at the end of Q1 2025.

Strategic integration of fintech solutions for digital service expansion

First Northwest Bancorp is actively pursuing partnerships to modernize its service delivery, a key focus for the new CEO, Curt Queyrouze, who brings experience in financial technology. The bank's strategy involves delivering digitally focused solutions through these alliances. You can see this in specific actions taken:

• The company maintains a joint venture to found Quin, a fintech focused on financial wellness nationwide.
• A partnership exists with Splash Financial to develop and deploy consumer loan products across the country.
• First Fed Bank launched Apiture for an elevated business banking experience on September 18, 2025.
• The bank also made an investment in Meriwether Group, a boutique investment banking and accelerator firm, back in 2022.

The appointment of Mr. Queyrouze, effective September 17, 2025, signals a continued commitment to this area, given his background in financial technology and risk management.

Active management of asset quality and nonperforming loans (NPLs)

Managing credit risk is a critical, ongoing activity, especially following elevated credit costs in 2024. The results show tangible improvement in asset quality metrics through the first three quarters of 2025. Nonperforming loans (NPLs) totaled $30.5 million at the end of 2024, but they fell to $26.4 million by March 31, 2025, a reduction of 13.5% from the prior quarter end. The Allowance for Credit Losses (ACLL) decreased by $2.1 million to $16.2 million as of Q3 2025, reflecting this improved credit quality. The ACLL as a percentage of total loans was 1.24% at March 31, 2025.

Treasury management and cash flow services for business clients

For its commercial clients, First Northwest Bancorp provides services designed to streamline cash flow and payment processes. These activities are relationship-driven, with managers tailoring solutions to specific industry needs. The core offerings in this area include:

• Automated Clearing House (ACH) origination.
• Wire transfers.
• Merchant card processing.

Here's a quick look at some key financial results from the third quarter of 2025, which directly reflect the outcomes of these key activities. Honestly, the return to quarterly profitability is a big step, even if the year-to-date is still negative.

Finance: draft 13-week cash view by Friday.

First Northwest Bancorp (FNWB) - Canvas Business Model: Key Resources

You're looking at the core assets First Northwest Bancorp (FNWB) relies on to execute its strategy. For a bank, these are the balance sheet strength, the physical footprint, and the human capital guiding the ship. Honestly, the capital position is what stands out right now, especially following the recent leadership change.

The balance sheet shows a solid foundation. The Total risk-based capital ratio stood at a strong 13.7% as of Q3 2025. That's a key indicator of regulatory compliance and stability. Supporting that is Shareholders' Equity, which was reported at $154.5 million at the end of the third quarter of 2025.

Here's a quick look at the hard numbers underpinning these resources:

The physical presence is concentrated in the Pacific Northwest. First Northwest Bancorp, through its subsidiary First Fed Bank, maintains a network of 16 locations across Washington State, with 12 of those being full-service branches. This local footprint is a tangible asset for community banking relationships.

Human capital is also a critical resource, particularly with the recent transition. The company brought in new executive leadership to guide the next phase. Key personnel include:

• Curt Queyrouze, the new President and Chief Executive Officer, starting September 17, 2025.
• Mr. Queyrouze brings over 40 years of financial services experience.
• His expertise spans credit, risk management, and financial technology.

Finally, the technological infrastructure is a necessary resource for modern banking. First Northwest Bancorp utilizes proprietary digital and mobile banking platforms to serve its customer base. This digital capability supports the traditional branch network.

First Northwest Bancorp (FNWB) - Canvas Business Model: Value Propositions

You're looking at the core promises First Northwest Bancorp (FNWB) makes to its customers as of late 2025. These aren't just marketing phrases; they are tied to the actual structure of their balance sheet and operations.

Community-oriented banking with local decision-making and expertise

The commitment here is to the Puget Sound region, serving communities in Snohomish and King counties. Management emphasizes honoring a legacy of over a century by remaining a trusted partner. This local focus is the bedrock of their model, even as they work to build a modern institution.

Here's a snapshot of the scale supporting this local presence as of September 30, 2025:

The President and Chief Executive Officer stated a commitment to delivering long-term value and remaining a trusted partner in the communities they serve.

Full spectrum of commercial and consumer lending products

First Northwest Bank offers lending across both consumer and business lines. For businesses, this includes commercial real estate mortgages, construction and development financing, and working capital lines of credit. For individuals, they provide residential mortgage financing, home equity lines of credit, and personal loans.

The loan portfolio as of September 30, 2025, stood at $1.61 billion (net). The net interest margin for the third quarter of 2025 improved to 2.91%, marking five consecutive quarters of improvement.

The quality of that portfolio shows proactive management:

• Nonperforming loans totaled $13.4 million at September 30, 2025.
• The Allowance for Credit Loss (ACLL) to nonperforming loans ratio increased to 121% at September 30, 2025.

Enhanced digital financial solutions through strategic fintech partnerships

The bank supports its client base with digital and mobile banking platforms for online account management, mobile deposits, and bill-pay services. They also offer treasury management services like ACH origination and wire transfers for businesses.

The pursuit of these enhancements is visible in their noninterest income line. For the third quarter of 2025, a period-over-period decrease was recorded in the value of equity and fintech partnership investments.

Personalized client relationships and tailored financial solutions

Relationship managers work with clients to understand industry-specific needs, delivering tailored financial solutions. This personalized approach is central to their community banking model, contrasting with larger, less localized institutions.

The operational focus in Q3 2025 resulted in a net income of $802,000, or $0.09 per diluted share, on revenue of $16.57 million.

Stable and secure deposit products for individuals and businesses

For retail customers, the value proposition includes a range of deposit products designed for stability. You can count on checking and savings accounts, money market accounts, and certificates of deposit (CDs).

Total deposits held by First Northwest Bancorp as of September 30, 2025, were $1.65 billion. The cost of all deposits for the three months ended September 30, 2025, was 2.20%.

Key deposit metrics for the quarter ending September 30, 2025, include:

• Net Interest Income: $14.6 million.
• Return on Equity (ROE): 2.10%.
• Net Margin: 2.67%.

Finance: draft 13-week cash view by Friday.

First Northwest Bancorp (FNWB) - Canvas Business Model: Customer Relationships

You're looking at how First Northwest Bancorp keeps its customers engaged and loyal as of late 2025. The relationship strategy clearly balances dedicated human interaction for complex needs with the efficiency of digital tools, all while staying rooted in its Pacific Northwest communities.

Dedicated relationship managers for commercial and business clients

For commercial and business clients, the model relies on dedicated expertise. While specific staffing numbers for relationship managers aren't public, the focus on core commercial customer growth in Q1 2025 suggests these relationships are key, even when wholesale funding shifts caused a temporary dip in total deposits. The bank's focus on asset quality monitoring, such as closely watching a group of commercial business loans totaling $149,000 in classified loans at September 30, 2025, implies direct, hands-on management for that segment.

High-touch, personalized service model at branch locations

The high-touch element is supported by a physical footprint that, as of September 30, 2025, consisted of 17 locations across Washington state. This network supports a community-oriented banking model rooted in local decision-making. The bank is actively refining this physical presence; for instance, in Q2 2025, First Northwest Bancorp consolidated its Bellevue and Fremont business centers into a new Seattle business center, an action expected to reduce annual rent expenses by $130,000 going forward. This suggests a move toward optimized, perhaps more advisory-focused, physical hubs rather than pure transaction centers.

Automated self-service via digital and mobile banking platforms

The self-service component meets the broader 2025 trend where a significant majority of consumers, about 77 percent nationally, prefer managing accounts via a mobile app or computer. While First Northwest Bancorp's specific digital adoption rates aren't detailed, the industry context shows that 48 percent of respondents log into their bank's mobile app or website daily. The bank's digital platforms support standard features like online account management and mobile deposits. The challenge, as seen across the industry, is ensuring these digital experiences are simple, as the average digital application abandonment rate more than doubled year-over-year in 2024.

Community reinvestment and philanthropic initiatives

Community connection is a stated focus, with First Fed Bank serving its communities since 1923. This commitment is operationalized through the First Fed Foundation, which, for example, invited final applications for its Fall Grant Cycle on August 25, 2025. This ongoing support for local economic development and non-profits is a core part of the relationship strategy in the region.

Proactive communication on asset quality and financial trends

Transparency regarding financial health is a key relationship tool, especially given recent economic shifts. The bank proactively communicates asset quality improvements. For example, nonperforming loans (NPL) decreased by $7.0 million between Q2 and Q3 2025, settling at $13.4 million as of September 30, 2025. Furthermore, the Allowance for Credit Losses (ACLL) to NPL ratio increased to 121% at the end of Q3 2025, up from 90% in Q2 2025, showing a stronger coverage position relative to the lower NPL balance. The Net Interest Margin also improved for five consecutive quarters, reaching 2.91% in Q3 2025.

Here are some key metrics reflecting the operational environment influencing customer relationships as of late 2025:

The emphasis on personalized service is supported by the structure, but the bank must continue to ensure its digital offerings keep pace with the national expectation that 73 percent of financial services customers report that personalized experiences significantly increase loyalty.

• Core commercial and consumer customer growth was reported as positive in Q1 2025.
• The First Fed Foundation actively manages its grant cycle, with the Fall 2025 cycle applications invited in August.
• The bank is focused on continued asset quality improvement throughout 2025.

Finance: review the Q4 2025 budget allocation for community outreach programs by end of the month.

First Northwest Bancorp (FNWB) - Canvas Business Model: Channels

First Northwest Bancorp (FNWB), through its subsidiary First Fed Bank, maintains a physical presence across the Puget Sound region of Washington State, serving customers since 1923. As of the third quarter of 2025, First Fed Bank operates 16 locations across Washington state, which includes 12 full-service branches. These physical points of service are strategically located in counties including Clallam, Jefferson, King, Kitsap, and Whatcom.

The bank has actively streamlined its physical footprint to improve efficiency. This included the consolidation of the Bellevue and Fremont business centers into a new Seattle business center located at 2157 North Northlake Way Suite 230, Seattle, WA 98103. This strategic move is projected to yield annual rent expense reductions of $130,000 going forward.

The current physical and digital footprint metrics for First Northwest Bancorp are summarized below:

Digital channels are critical for account management and service delivery. First Fed Bank launched the Apiture platform in September 2025 to provide an elevated business banking experience. While specific First Northwest Bancorp adoption rates for late 2025 aren't public, industry data suggests that a significant majority, specifically 77 percent of consumers, prefer to manage their bank accounts through a mobile app or a computer.

The corporate website serves as the primary gateway for information and online service initiation. The bank also focuses on strategic partnerships to deliver modern financial services, including marketplace lending, which is accessed through online portals. The direct sales force remains a key channel for high-value relationship banking, specifically targeting the origination of one- to four-family mortgage loans, commercial and multi-family real estate loans, construction and land loans, and commercial business loans.

Key digital and direct relationship access points include:

• Digital and mobile banking applications for account management.
• Corporate website access for general information and service initiation.
• Online lending portals supporting marketplace lending initiatives.
• Direct sales force engagement for commercial and real estate lending.

First Northwest Bancorp (FNWB) - Canvas Business Model: Customer Segments

You're looking at the core groups First Northwest Bancorp (FNWB) serves through its subsidiary, First Fed Bank, which has been operating in the Pacific Northwest since 1923. The bank's stated operating strategy focuses on building sustainable earnings by delivering a full array of financial products and services across several distinct customer types.

The geographic footprint is concentrated, with First Fed Bank operating 16 locations in Washington state, including 12 full-service branches across Clallam, Jefferson, King, Kitsap, and Whatcom Counties.

Here's a breakdown of the primary customer segments First Northwest Bancorp targets:

• Individuals and families in the Pacific Northwest seeking mortgages and consumer loans
• Small to mid-sized businesses requiring commercial loans and treasury services
• Non-profit organizations needing deposit and lending services
• Real estate developers and investors (commercial and multi-family)
• Shareholders and institutional investors (as a publicly traded company, FNWB)

For individuals, the offering includes one- to four-family mortgage loans, consumer loans primarily consisting of automobile loans, and home-equity loans and lines of credit. Deposits are sourced from checking, money market deposit, savings, transaction accounts, and certificates of deposit (CDs).

Commercial clients, which include small to mid-sized businesses and real estate developers, are served with commercial and multi-family real estate loans, as well as construction and land loans. The bank also focuses on commercial business loans. To support these clients, First Northwest Bancorp focuses on building commercial relationship-based lending.

The bank's asset quality metrics give you a sense of the current lending environment it manages. At September 30, 2025, nonperforming loans stood at $13.4 million. The Allowance for Credit Losses (ACLL) on loans was $16.2 million, representing an ACLL to nonperforming loans ratio of 121% at that date, which is up from 90% at June 30, 2025. The ACLL as a percentage of total loans was 1.00% as of September 30, 2025.

The shareholder base is a distinct segment, as First Northwest Bancorp is publicly traded on NASDAQ under the ticker FNWB. As of late 2025 reporting, the company had 8.81 million shares outstanding and a market capitalization around $88.23 million. Institutional investors held approximately 46.05% of the shares, while insiders held 8.20%. This segment receives capital returns, evidenced by the declared quarterly cash dividend of $0.07 per common share payable on May 23, 2025.

First Northwest Bancorp also supports its strategy through specialized entities. In 2022, the company invested in The Meriwether Group, LLC, a boutique investment banking and accelerator firm, and it pursues strategic partnerships for modern financial services like digital payments and marketplace lending, which may serve a niche segment of its commercial or individual clients looking for non-traditional banking products.

Here are some key financial figures that frame the operational scale supporting these customer segments for the fiscal year 2025:

The bank's focus on a full array of services for individuals, small businesses, non-profits, and commercial customers suggests a broad, community-centric approach within its defined Washington state market. The investment in Meriwether Group hints at a segment of clients interested in boutique investment banking services, which is a less common offering for a community bank of this size.

First Northwest Bancorp (FNWB) - Canvas Business Model: Cost Structure

You're looking at the expense side of First Northwest Bancorp (FNWB), which is where the rubber meets the road for a community bank navigating a complex rate environment. The cost structure is heavily weighted toward funding costs and operational overhead, which you need to watch closely.

Interest expense on deposits and borrowings is a major component. For the third quarter of 2025, this figure totaled $12.3 million. That number reflects the cost of funding their balance sheet, though the cost of total deposits actually dropped to 2.20% in Q3 2025 from 2.31% in the preceding quarter as higher-rate certificates of deposit matured. That liability management helped the net interest margin improve to 2.91% in Q3 2025.

Operating expenses, categorized as noninterest expense, were high in the most recent quarter, reaching $17.4 million in Q3 2025, up from $15.8 million in the same quarter last year. This increase is partly explained by specific pressures like higher compensation expenses tied to executive management changes and increased legal expenses stemming from ongoing legal proceedings. Honestly, these one-off items can really skew the quarterly view.

Credit quality costs are another area to track. For the first quarter of 2025, First Northwest Bancorp recorded a provision for credit losses on loans of $1.6 million. This was primarily driven by charge-offs related to commercial business loans, a commercial construction loan, and some consumer loans. That compares to $3.8 million in the preceding quarter, so you see some fluctuation there.

The physical footprint contributes to fixed costs. First Northwest Bancorp, through its subsidiary First Fed Bank, maintains 16 locations across Washington state, including 12 full-service branches. Maintaining this physical presence, along with the necessary technology spend for digital platforms, rolls into that total noninterest expense figure. Here's the quick math: the $17.4 million in Q3 2025 noninterest expense covers everything from salaries to rent and data processing.

Here are the key cost metrics we have for recent periods:

You should also be aware of other related expense drivers:

• Charge-offs totaling $1.4 million in Q1 2025.
• Allowance for Credit Losses (ACLL) on loans stood at $20.6 million as of March 31, 2025.
• Nonperforming loans totaled $26.4 million at March 31, 2025.
• The company recorded a $846,000 gain on extinguishment of debt in Q1 2025, which reduced future interest expense costs.

Finance: draft 13-week cash view by Friday.

First Northwest Bancorp (FNWB) - Canvas Business Model: Revenue Streams

You're looking at the core ways First Northwest Bancorp actually brings in the money, which for a bank like this, is heavily weighted toward the balance sheet activity. Honestly, the revenue story for First Northwest Bancorp in late 2025 is all about the spread between what they earn on assets and what they pay for liabilities.

The primary engine is the Net Interest Income from loan and investment portfolios. For the third quarter of 2025, the Net Interest Margin (NIM) clocked in at a healthy 2.91%. This is a key metric showing efficiency in their core lending and investing business, representing five consecutive quarters of improvement. This margin is what you want to watch closely, as it directly reflects their pricing power and funding cost management.

Drilling down, the Interest income on loans receivable is the biggest piece of the top-line interest earnings. For Q3 2025, First Northwest Bancorp reported total interest income of $26.9 million. This income stream is supported by their principal lending activities, which include first lien one- to four-family mortgage loans, commercial and multi-family real estate loans, construction and land loans, commercial business loans, and consumer loans. The resulting Net Interest Income (NII) for that same quarter was $14.6 million, which is the crucial figure after subtracting interest expense.

Beyond the core lending spread, Non-interest income provides diversification, though it was smaller in Q3 2025. Total noninterest income for the third quarter of 2025 was reported at $2.0 million, which was a sequential decrease from the preceding quarter. This bucket covers service charges, fees, and treasury management activities, though the Q3 figure was impacted by a period-over-period decrease in the value of equity and fintech partnership investments.

You also see revenue from asset management activities, which can be lumpy. For example, in the first quarter of 2025, First Northwest Bancorp recorded a $846,000 gain on extinguishment of debt related to repurchasing subordinated debt at a discount. To be fair, gains on sale of loans or investment securities can fluctuate; in Q3 2025, there was a $0.7 million increase in gain on sale of the guaranteed portion of SBA loans compared to Q2 2025.

Here's a quick look at the top-line results for the quarter that defines the current revenue snapshot:

So, the revenue streams are clearly anchored by the interest-earning assets, but management is definitely working to control funding costs to keep that NIM expanding. The total revenue figure for Q3 2025 came in at $16.57 million, missing analyst estimates of $17.25 million for that period.

To summarize the key components contributing to the overall revenue generation:

• Net Interest Income (NII) driving the majority of earnings.
• Net Interest Margin (NIM) at 2.91% in Q3 2025.
• Total Interest Income was $26.9 million in Q3 2025.
• Non-interest income was $2.0 million in Q3 2025.
• Occasional gains, such as the $846,000 gain on debt extinguishment in Q1 2025.

Finance: draft 13-week cash view by Friday.