Finward Bancorp (NASDAQ: FNWD)

Finward Bancorp, also known as FNWD, operates in the banking industry and specializes in attracting deposits from the general public and originating loans, primarily secured by single-family residences and commercial real estate, within its primary market areas of Lake and Porter Counties in Northwest Indiana and Cook County in Illinois.

Finward Bancorp's main business activities involve attracting deposits and originating loans, which generate revenue for the company. The company's lending activities include residential mortgage loans, construction loans, commercial real estate loans, consumer loans, and manufactured home loans. The primary sources of loan originations are referrals from commercial customers, real estate brokers and builders, solicitations by the bank's lending and retail staff, and advertising of loan programs and rates.

Residential mortgage loans are the Bancorp's primary lending activity. These loans enable borrowers to purchase existing homes, refinance existing homes, or construct new homes. Conventional loans are made up to a maximum of 97% of the purchase price or appraised value, whichever is less. The company also offers adjustable-rate mortgage loans. ARM originations totaled $17.7 million for 2023 and $44.6 million for 2022.

Construction loans on residential properties are made primarily to individuals and contractors who are under contract with individual purchasers. These loans are personally guaranteed by the borrower, and the maximum loan-to-value ratio is 89% of either the current appraised value or the cost of construction, whichever is less.

Commercial real estate loans are typically made to a maximum of 80% of the appraised value and are generally made on an adjustable rate basis. These loans are typically made for terms of 15 to 20 years. Loans with an amortizing term exceeding 15 years normally have a balloon feature calling for a full repayment within seven to ten years from the date of the loan.

Consumer loans are offered to individuals for personal, household, or family purposes. Consumer loans are either secured by adequate collateral or unsecured. Unsecured loans are based on the strength of the applicant's financial condition.

The Bancorp purchases fixed-rate closed loans from a third party that are subject to Bancorp's underwriting requirements and secured by manufactured homes. The maturity date on these loans can range up to 25 years.

Finward Bancorp has a strong position within the industry, with a diverse range of products and services offered to its customers. The company's primary market area is in Lake and Porter Counties in Northwest Indiana and Cook County in Illinois, where it has a strong presence and reputation. The company's key competitors include other regional banks and financial institutions. The company's experienced loan officers and underwriters are well-versed in the local market and are able to provide customized solutions to meet the unique needs of its customers.

The company's non-performing assets include loans that are 90 days or more past due and loans that are classified as substandard or doubtful. The company's investment portfolio includes U.S. government agency securities, mortgage-backed securities, collateralized mortgage obligations, municipal securities, and treasury securities. The company's sources of funds include deposits, loan repayments, and borrowings.