KBRA Comments on First Northwest Bancorp

4 Dec 2023   |   New York


KBRA comments on the recent FDIC consent order (placed on November 21, 2023) against Port Angeles, Washington-based First Fed Bank ("the bank"), the primary subsidiary of First Northwest Bancorp (NASDAQ: FNWB) ("the company"). The consent order was related to findings that are in connection to the banking relationship with Quin Ventures, which First Fed Bank established as a Joint Venture in 2021. First Fed Bank initially self-reported the issue to the FDIC in 2022, and the bank has already added resources to compliance and control functions to address the issues. The company is in full cooperation with the consent order requirements to correct the violations with regards to consumer lending and implementing new policies and procedures to prevent future violations. Furthermore, the consent order is not expected to have any material effect on the bank’s operations, earnings, or capital. As such, KBRA does not consider the consent order as having a material impact on First Northwest Bancorp’s or First Fed Bank's ratings or credit profile.

On March 7, 2023, KBRA affirmed the senior unsecured debt rating of BBB, the subordinated debt rating of BBB-, and the short-term debt rating of K3 for First Northwest Bancorp. In addition, KBRA affirmed the deposit and senior unsecured debt ratings of BBB+, the subordinated debt rating of BBB, and the short-term deposit and debt ratings of K2 for its bank subsidiary, First Fed Bank. The Outlook for all long-term ratings is Stable.

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About KBRA

KBRA is a full-service credit rating agency registered in the U.S., the EU, and the UK, and is designated to provide structured finance ratings in Canada. KBRA’s ratings can be used by investors for regulatory capital purposes in multiple jurisdictions.

Doc ID: 1002775

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