Westamerica Bancorporation Reports Third Quarter 2018 Financial Results

SAN RAFAEL, Calif., Oct. 18, 2018 (GLOBE NEWSWIRE) -- Westamerica Bancorporation (Nasdaq: WABC), parent company of Westamerica Bank, generated net income for the third quarter 2018 of $17.0 million and diluted earnings per common share ("EPS") of $0.63; third quarter 2018 results include a $585 thousand tax-exempt life insurance policy gain and a $3.5 million contingency settlement, which on an aggregate basis reduced EPS $0.07. Third quarter 2018 results compare to second quarter 2018 net income of $18.0 million and EPS of $0.67, and third quarter 2017 net income of $15.0 million and EPS of $0.57.

"Third quarter 2018 net interest income demonstrated continuing improvement as rising market interest rates benefit the yields on our interest earning assets. Our annualized funding costs were unchanged at 0.04 percent of interest-earning assets due to the predominance of low-cost checking and savings accounts in our deposit portfolio. The net interest margin on a fully-taxable equivalent (“FTE”) basis rose from 3.08 percent in the second quarter 2018 to 3.10 percent in the third quarter 2018. Asset quality remains solid with nonperforming assets totaling only $6.5 million at September 30, 2018, and net loan losses of $1 million for the first nine months of 2018,” said Chairman, President and CEO David Payne. “Third quarter 2018 results generated an annualized 10.6 percent return on average common equity. These consistent operating results allowed the Board of Directors to approve a $0.40 per share dividend in the third quarter 2018, totaling $10.7 million, for our shareholders,” concluded Payne.

Net interest income (FTE) was $37.1 million for the third quarter 2018, compared to $36.6 million for the second quarter 2018 and $35.7 million for the third quarter 2017. The net interest margin (FTE) was 3.10 percent for the third quarter 2018, compared to 3.08 percent for the second quarter 2018 and 3.10 percent for the third quarter 2017. Checking and savings deposits, which are less sensitive to rising interest rates than time deposits, represented ninety-six percent of the Company’s average deposit base during the third quarter 2018.

The Company recognized no provision for loan losses for the third quarter 2018 given stable nonperforming loan volumes and other credit quality attributes.

Noninterest income for the third quarter 2018 totaled $12.5 million, compared to $11.8 million for the second quarter 2018 and $12.5 million for the third quarter 2017. Noninterest income for the third quarter 2018 included a tax-exempt life insurance policy gain of $585 thousand.

Noninterest expense for the third quarter 2018 totaled $27.0 million, compared to $24.0 million for the second quarter 2018 and $24.1 million for the third quarter 2017. Noninterest expense for the third quarter 2018 included a $3.5 million contingency settlement as the Company achieved a mediated settlement to dismiss a lawsuit.

The tax rate (FTE) applied to pre-tax income (FTE) was 25.0 percent for the third quarter 2018, compared to 26.1 percent for the second quarter 2018 and 37.7 percent for the third quarter 2017. The lower tax rates for 2018 compared to 2017 reflect a reduction in the federal corporate tax rate due to the Tax Cuts and Jobs Act of 2017. The book tax provisions for the third quarter 2018 and the second quarter 2018 include tax benefits of $152 thousand and $128 thousand, respectively, for tax deductions from the exercise of employee stock options which exceed related compensation expense recognized in the financial statements.

Westamerica Bancorporation, through its wholly owned subsidiary Westamerica Bank, operates commercial banking and trust offices throughout Northern and Central California.

Westamerica Bancorporation Web Address: www.westamerica.com

For additional information contact:
Westamerica Bancorporation
1108 Fifth Avenue, San Rafael, CA 94901
Robert A. Thorson – SVP & Chief Financial Officer
707-863-6840
investments@westamerica.com

FORWARD-LOOKING INFORMATION:

The following appears in accordance with the Private Securities Litigation Reform Act of 1995:

This press release may contain forward-looking statements about the Company, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words "believe," "expect," "anticipate," "intend," "plan," "estimate," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may."

Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors — many of which are beyond the Company's control — could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. The Company's most recent reports filed with the Securities and Exchange Commission, including the annual report for the year ended December 31, 2017 filed on Form 10-K and quarterly report for the quarter ended June 30, 2018 filed on Form 10-Q, describe some of these factors, including certain credit, interest rate, operational, liquidity and market risks associated with the Company's business and operations. Other factors described in these reports include changes in business and economic conditions, competition, fiscal and monetary policies, disintermediation, legislation including the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2011, the Sarbanes-Oxley Act of 2002 and the Gramm-Leach-Bliley Act of 1999, and mergers and acquisitions.

Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward looking statements are made.

		Public Information October 18, 2018
WESTAMERICA BANCORPORATION
FINANCIAL HIGHLIGHTS
September 30, 2018

1. Net Income Summary.
		*(in thousands except per-share amounts)*
						%
		Q3'18		Q3'17		Change		Q2'18

	Net Interest and Fee Income (FTE)	$37,137		$35,680		4.1	%	$36,585
	Reversal of Provision for Loan Losses	-		-		n/m		-
	Noninterest Income	12,528		12,548		-0.2	%	11,769
	Noninterest Expense	27,005		24,114		12.0	%	23,977
	Income Before Taxes (FTE)	22,660		24,114		-6.0	%	24,377
	Income Tax Provision (FTE)	5,667		9,097		-37.7	%	6,367
	Net Income	$16,993		$15,017		13.2	%	$18,010

	Average Common Shares Outstanding	26,701		26,309		1.5	%	26,630
	Diluted Average Common Shares	26,815		26,404		1.6	%	26,728

	Operating Ratios:
	Basic Earnings Per Common Share	$0.64		$0.57		12.3	%	$0.68
	Diluted Earnings Per Common Share	0.63		0.57		10.5	%	0.67
	Return On Assets (a)	1.19	%	1.09	%			1.29	%
	Return On Common Equity (a)	10.6	%	9.9	%			11.6	%
	Net Interest Margin (FTE) (a)	3.10	%	3.10	%			3.08	%
	Efficiency Ratio (FTE)	54.4	%	50.0	%			49.6	%

	Dividends Paid Per Common Share	$0.40		$0.39		2.6	%	$0.40
	Common Dividend Payout Ratio	63	%	68	%			60	%

						%
		9/30'18YTD		9/30'17YTD		Change

	Net Interest and Fee Income (FTE)	$109,189		$107,474		1.6	%
	Reversal of Provision for Loan Losses	-		(1,900	)	n/m
	Noninterest Income	36,252		36,328		-0.2	%
	Noninterest Expense	75,196		73,125		2.8	%
	Income Before Taxes (FTE)	70,245		72,577		-3.2	%
	Income Tax Provision (FTE)	17,736		26,712		-33.6	%
	Net Income	$52,509		$45,865		14.5	%

	Average Common Shares Outstanding	26,622		26,260		1.4	%
	Diluted Average Common Shares	26,736		26,379		1.4	%

	Operating Ratios:
	Basic Earnings Per Common Share	$1.97		$1.75		12.6	%
	Diluted Earnings Per Common Share	1.96		1.74		12.6	%
	Return On Assets (a)	1.25	%	1.13	%
	Return On Common Equity (a)	11.2	%	10.4	%
	Net Interest Margin (FTE) (a)	3.07	%	3.12	%
	Efficiency Ratio (FTE)	51.7	%	50.9	%

	Dividends Paid Per Common Share	$1.20		$1.17		2.6	%
	Common Dividend Payout Ratio	61	%	67	%

2. Net Interest Income.
		*(dollars in thousands)*
						%
		Q3'18		Q3'17		Change		Q2'18

	Interest and Fee Income (FTE)	$37,664		$36,153		4.2	%	$37,044
	Interest Expense	527		473		11.4	%	459
	Net Interest and Fee Income (FTE)	$37,137		$35,680		4.1	%	$36,585

	Average Earning Assets	$4,786,511		$4,587,848		4.3	%	$4,752,887
	Average Interest-
	Bearing Liabilities	2,733,670		2,687,620		1.7	%	2,729,671

	Yield on Earning Assets (FTE) (a)	3.14	%	3.14	%			3.12	%
	Cost of Funds (a)	0.04	%	0.04	%			0.04	%
	Net Interest Margin (FTE) (a)	3.10	%	3.10	%			3.08	%
	Interest Expense/
	Interest-Bearing Liabilities (a)	0.08	%	0.07	%			0.07	%
	Net Interest Spread (FTE) (a)	3.06	%	3.07	%			3.05	%

						%
		9/30'18YTD		9/30'17YTD		Change

	Interest and Fee Income (FTE)	$110,634		$108,903		1.6	%
	Interest Expense	1,445		1,429		1.1	%
	Net Interest and Fee Income (FTE)	$109,189		$107,474		1.6	%

	Average Earning Assets	$4,754,436		$4,601,931		3.3	%
	Average Interest-
	Bearing Liabilities	2,732,520		2,694,785		1.4	%

	Yield on Earning Assets (FTE) (a)	3.11	%	3.16	%
	Cost of Funds (a)	0.04	%	0.04	%
	Net Interest Margin (FTE) (a)	3.07	%	3.12	%
	Interest Expense/
	Interest-Bearing Liabilities (a)	0.07	%	0.07	%
	Net Interest Spread (FTE) (a)	3.04	%	3.09	%

3. Loans & Other Earning Assets.
		*(average volume, dollars in thousands)*
						%
		Q3'18		Q3'17		Change		Q2'18

	Total Assets	$5,648,004		$5,441,612		3.8	%	$5,587,871
	Total Earning Assets	4,786,511		4,587,848		4.3	%	4,752,887
	Total Loans	1,194,874		1,287,740		-7.2	%	1,209,049
	Commercial Loans	288,634		324,727		-11.1	%	295,971
	Commercial RE Loans	554,081		566,794		-2.2	%	550,427
	Consumer Loans	352,159		396,219		-11.1	%	362,651
	Total Investment Securities	3,591,637		3,300,108		8.8	%	3,543,838
	Equity Securities	1,749		2,992		-41.5	%	1,763
	Debt Securities Available For Sale	2,538,837		2,063,576		23.0	%	2,444,582
	Debt Securities Held To Maturity	1,051,051		1,233,540		-14.8	%	1,097,493

	Loans/Deposits	24.4	%	27.3	%			24.9	%

						%
		9/30'18YTD		9/30'17YTD		Change

	Total Assets	$5,600,499		$5,407,661		3.6	%
	Total Earning Assets	4,754,436		4,601,931		3.3	%
	Total Loans	1,215,712		1,325,128		-8.3	%
	Commercial Loans	300,215		343,091		-12.5	%
	Commercial RE Loans	553,507		563,980		-1.9	%
	Consumer Loans	361,990		418,057		-13.4	%
	Total Investment Securities	3,538,724		3,276,803		8.0	%
	Equity Securities	1,834		3,043		-39.7	%
	Debt Securities Available For Sale	2,442,335		1,994,281		22.5	%
	Debt Securities Held To Maturity	1,094,555		1,279,479		-14.5	%

	Loans/Deposits	25.0	%	28.2	%

4. Deposits, Other Interest-Bearing Liabilities & Equity.
		*(average volume, dollars in thousands)*
						%
		Q3'18		Q3'17		Change		Q2'18

	Total Deposits	$4,893,859		$4,714,579		3.8	%	$4,846,986
	Noninterest Demand	2,223,678		2,103,042		5.7	%	2,177,708
	Interest Bearing Transaction	935,257		891,532		4.9	%	924,542
	Savings	1,526,100		1,475,969		3.4	%	1,523,024
	Time greater than $100K	90,668		108,673		-16.6	%	99,955
	Time less than $100K	118,156		135,363		-12.7	%	121,757
	Total Short-Term Borrowings	63,489		76,083		-16.6	%	60,393
	Shareholders' Equity	636,965		599,473		6.3	%	625,409

	Demand Deposits/
	Total Deposits	45.4	%	44.6	%			44.9	%
	Transaction & Savings
	Deposits / Total Deposits	95.7	%	94.8	%			95.4	%

						%
		9/30'18YTD		9/30'17YTD		Change

	Total Deposits	$4,856,639		$4,692,330		3.5	%
	Noninterest Demand	2,186,250		2,069,521		5.6	%
	Interest Bearing Transaction	928,479		884,171		5.0	%
	Savings	1,522,414		1,489,643		2.2	%
	Time greater than $100K	97,877		110,512		-11.4	%
	Time less than $100K	121,619		138,483		-12.2	%
	Total Short-Term Borrowings	62,131		71,976		-13.7	%
	Shareholders' Equity	625,496		591,691		5.7	%

	Demand Deposits/
	Total Deposits	45.0	%	44.1	%
	Transaction & Savings
	Deposits / Total Deposits	95.5	%	94.7	%

5. Interest Yields Earned & Rates Paid.
		*(dollars in thousands)*
		Q3'18
		Average		Income/		Yield (a) /
		Volume		Expense		Rate

	Interest & Fee Income Earned
	Total Earning Assets (FTE)	$4,786,511		$37,664		3.14	%
	Total Loans (FTE)	1,194,874		14,707		4.88	%
	Commercial Loans (FTE)	288,634		3,675		5.05	%
	Commercial RE Loans	554,081		7,556		5.41	%
	Consumer Loans	352,159		3,476		3.92	%
	Total Investments (FTE)	3,591,637		22,957		2.56	%

	Interest Expense Paid
	Total Earning Assets	4,786,511		527		0.04	%
	Total Interest-Bearing Liabilities	2,733,670		527		0.08	%
	Total Interest-Bearing Deposits	2,670,181		518		0.08	%
	Interest-Bearing Transaction	935,257		129		0.05	%
	Savings	1,526,100		229		0.06	%
	Time less than $100K	118,156		69		0.23	%
	Time greater than $100K	90,668		91		0.40	%
	Total Short-Term Borrowings	63,489		9		0.06	%

	Net Interest Income and
	Margin (FTE)			37,137		3.10	%

		Q3'17
		Average		Income/		Yield (a) /
		Volume		Expense		Rate

	Interest & Fee Income Earned
	Total Earning Assets (FTE)	$4,587,848		$36,153		3.14	%
	Total Loans (FTE)	1,287,740		15,349		4.73	%
	Commercial Loans (FTE)	324,727		3,959		4.84	%
	Commercial RE Loans	566,794		7,806		5.46	%
	Consumer Loans	396,219		3,584		3.59	%
	Total Investments (FTE)	3,300,108		20,804		2.52	%

	Interest Expense Paid
	Total Earning Assets	4,587,848		473		0.04	%
	Total Interest-Bearing Liabilities	2,687,620		473		0.07	%
	Total Interest-Bearing Deposits	2,611,537		461		0.07	%
	Interest-Bearing Transaction	891,532		60		0.03	%
	Savings	1,475,969		220		0.06	%
	Time less than $100K	135,363		78		0.23	%
	Time greater than $100K	108,673		103		0.38	%
	Total Short-Term Borrowings	76,083		12		0.06	%

	Net Interest Income and
	Margin (FTE)			$35,680		3.10	%

6. Noninterest Income.
		*(dollars in thousands except per-share amounts)*
						%
		Q3'18		Q3'17		Change		Q2'18

	Service Charges on Deposits	$4,615		$4,989		-7.5	%	$4,645
	Merchant Processing Services	2,464		2,153		14.4	%	2,305
	Debit Card Fees	1,656		1,784		-7.2	%	1,698
	Other Service Fees	665		652		2.0	%	650
	ATM Processing Fees	687		684		0.5	%	698
	Trust Fees	733		718		2.0	%	726
	Life Insurance Gains	585		-		n/m		-
	Financial Services Commissions	132		148		-10.4	%	141
	Equity Securities Losses	(16	)	-		n/m		(14	)
	Other Income	1,007		1,420		-29.1	%	920
	Total Noninterest Income	$12,528		$12,548		-0.2	%	$11,769

	Total Revenue (FTE)	$49,665		$48,228		3.0	%	$48,354
	Noninterest Income/Revenue (FTE)	25.2	%	26.0	%			24.3	%
	Service Charges/Avg. Deposits (a)	0.37	%	0.42	%			0.38	%
	Total Revenues (FTE) Per Avg.
	Common Share (a)	$7.38		$7.27		1.5	%	$7.28

						%
		9/30'18YTD		9/30'17YTD		Change

	Service Charges on Deposits	$14,012		$14,857		-5.7	%
	Merchant Processing Services	7,190		6,080		18.2	%
	Debit Card Fees	4,959		4,851		2.2	%
	Other Service Fees	1,946		1,964		-0.9	%
	ATM Processing Fees	2,049		1,914		7.1	%
	Trust Fees	2,202		2,136		3.1	%
	Life Insurance Gains	585		-		n/m
	Financial Services Commissions	387		484		-20.0	%
	Equity Securities Losses	(66	)	-		n/m
	Other Income	2,988		4,042		-26.1	%
	Total Noninterest Income	$36,252		$36,328		-0.2	%

	Total Revenue (FTE)	$145,441		$143,802		1.1	%
	Noninterest Income/Revenue (FTE)	24.9	%	25.3	%
	Service Charges/Avg. Deposits (a)	0.39	%	0.42	%
	Total Revenues (FTE) Per Avg.
	Common Share (a)	$7.30		$7.32		-0.2	%

7. Noninterest Expense.
		*(dollars in thousands)*
						%
		Q3'18		Q3'17		Change		Q2'18

	Salaries & Benefits	$13,415		$12,816		4.7	%	$13,186
	Occupancy and Equipment	4,809		4,907		-2.0	%	4,864
	Loss Contingency (1)	3,500		-		n/m		-
	Outsourced Data Processing	2,292		2,383		-3.8	%	2,299
	Amortization of
	Identifiable Intangibles	451		760		-40.7	%	453
	Professional Fees	621		512		21.2	%	871
	Courier Service	448		451		-0.7	%	422
	Other Operating	1,469		2,285		-35.7	%	1,882
	Total Noninterest Expense	$27,005		$24,114		12.0	%	$23,977

	Noninterest Expense/
	Avg. Earning Assets (a)	2.24	%	2.09	%			2.02	%
	Noninterest Expense/Revenues (FTE)	54.4	%	50.0	%			49.6	%

						%
		9/30'18YTD		9/30'17YTD		Change

	Salaries & Benefits	$39,952		$38,867		2.8	%
	Occupancy and Equipment	14,365		14,571		-1.4	%
	Outsourced Data Processing	6,930		6,710		3.3	%
	Loss Contingency (1)	3,500		-		n/m
	Amortization of
	Identifiable Intangibles	1,474		2,322		-36.5	%
	Professional Fees	2,277		1,533		48.5	%
	Courier Service	1,333		1,310		1.8	%
	Other Operating	5,365		7,812		-31.3	%
	Total Noninterest Expense	$75,196		$73,125		2.8	%

	Noninterest Expense/
	Avg. Earning Assets (a)	2.11	%	2.12	%
	Noninterest Expense/Revenues (FTE)	51.7	%	50.9	%

8. Allowance for Loan Losses.
		*(dollars in thousands)*
						%
		Q3'18		Q3'17		Change		Q2'18

	Average Total Loans	$1,194,874		$1,287,740		-7.2	%	$1,209,049

	Allowance for Loan Loss (ALL)
	Beginning of Period	$23,040		$24,103		-4.4	%	$23,081
	Reversal of Provision for Loan Losses	-		-		n/m		-
	Net ALL Losses	(1,013	)	(475	)	n/m		(41	)
	ALL End of Period	$22,027		$23,628		-6.8	%	$23,040
	Net ALL Losses / Gross ALL Losses	31	%	53	%			95	%

	Net ALL Losses / Avg. Total Loans (a)	0.34	%	0.15	%			0.01	%

						%
		9/30'18YTD		9/30'17YTD		Change

	Average Total Loans	$1,215,712		$1,325,128		-8.3	%

	Allowance for Loan Loss (ALL)
	Beginning of Period	$23,009		$25,954		-11.3	%
	Reversal of Provision for Loan Losses	-		(1,900	)	n/m
	Net ALL Losses	(982	)	(426	)	n/m
	ALL End of Period	$22,027		$23,628		-6.8	%
	Net ALL Losses / Gross ALL Losses	73	%	91	%

	Net ALL Losses / Avg. Total Loans (a)	0.11	%	0.04	%

9. Credit Quality.
		*(dollars in thousands)*
						%
		9/30/18		9/30/17		Change		6/30/18

	Nonperforming Loans:
	Nonperforming Nonaccrual	$1,611		$1,498		7.5	%	$783
	Performing Nonaccrual	3,870		4,285		-9.7	%	4,110
	Total Nonaccrual Loans	5,481		5,783		-5.2	%	4,893
	90+ Days Past Due Accruing Loans	361		434		-16.8	%	193
	Total	5,842		6,217		-6.0	%	5,086
	Repossessed Loan Collateral	620		1,426		-56.5	%	939
	Total Nonperforming Assets	$6,462		$7,643		-15.4	%	$6,025

	Total Loans Outstanding	$1,196,955		$1,284,782		-6.8	%	$1,200,192

	Total Assets	$5,529,463		$5,445,808		1.5	%	$5,577,844

	Loans:
	Allowance for Loan Losses	$22,027		$23,628		-6.8	%	$23,040
	Allowance/Loans	1.84	%	1.84	%			1.92	%
	Nonperforming Loans/Total Loans	0.49	%	0.48	%			0.42	%

10. Capital.
		*(in thousands, except per-share amounts)*
						%
		9/30/18		9/30/17		Change		6/30/18

	Shareholders' Equity	$592,591		$603,957		-1.9	%	$586,138
	Total Assets	5,529,463		5,445,808		1.5	%	5,577,844

	Shareholders' Equity/
	Total Assets	10.72	%	11.09	%			10.51	%
	Shareholders' Equity/
	Total Loans	49.51	%	47.01	%			48.84	%
	Tangible Common Equity Ratio	8.67	%	8.98	%			8.47	%
	Common Shares Outstanding	26,727		26,319		1.6	%	26,649
	Common Equity Per Share	$22.17		$22.95		-3.4	%	$21.99
	Market Value Per Common Share	$60.16		$59.54		1.0	%	$56.51

	Share Repurchase Programs
		*(shares in thousands)*
						%
		Q3'18		Q3'17		Change		Q2'18

	Total Shares Repurchased	-		-		n/m		9
	Average Repurchase Price	$-		$-		n/m		$58.46
	Net Shares Issued	(78	)	(15	)	n/m		(58	)

						%
		9/30'18YTD		9/30'17YTD		Change

	Total Shares Repurchased	9		6		n/m
	Average Repurchase Price	$58.46		$56.51		n/m
	Net Shares Issued	(302	)	(412	)	n/m

11. Period-End Balance Sheets.
		*(unaudited, dollars in thousands)*
						%
		9/30/18		9/30/17		Change		6/30/18
	Assets:
	Cash and Due from Banks	$522,660		$561,757		-7.0	%	$629,146

	Investment Securities:
	Equity Securities	1,734		11,373		n/m		1,750
	Debt Securities Available For Sale	2,478,908		2,079,104		19.2	%	2,363,194
	Debt Securities Held to Maturity	1,025,699		1,204,240		-14.8	%	1,076,456

	Loans	1,196,955		1,284,782		-6.8	%	1,200,192
	Allowance For Loan Losses	(22,027	)	(23,628	)	-6.8	%	(23,040	)
	Total Loans, net	1,174,928		1,261,154		-6.8	%	1,177,152

	Other Real Estate Owned	620		1,426		-56.5	%	939
	Premises and Equipment, net	35,391		35,507		-0.3	%	35,774
	Identifiable Intangibles, net	2,376		4,605		-48.4	%	2,827
	Goodwill	121,673		121,673		0.0	%	121,673
	Other Assets	165,474		164,969		0.3	%	168,933

	Total Assets	$5,529,463		$5,445,808		1.5	%	$5,577,844

	Liabilities and Shareholders' Equity:
	Deposits:
	Noninterest Bearing	$2,211,028		$2,128,342		3.9	%	$2,205,971
	Interest-Bearing Transaction	909,954		873,145		4.2	%	939,002
	Savings	1,510,015		1,491,168		1.3	%	1,526,228
	Time	204,840		241,925		-15.3	%	215,921
	Total Deposits	4,835,837		4,734,580		2.1	%	4,887,122

	Short-Term Borrowed Funds	61,756		66,337		-6.9	%	68,894
	Other Liabilities	39,279		40,934		-4.0	%	35,690
	Total Liabilities	4,936,872		4,841,851		2.0	%	4,991,706

	Shareholders' Equity:
	Common Equity:
	Paid-In Capital	449,180		427,188		5.1	%	444,871
	Accumulated Other
	Comprehensive Loss	(54,066	)	(3,433	)	n/m		(49,900	)
	Retained Earnings	197,477		180,202		9.6	%	191,167
	Total Shareholders' Equity	592,591		603,957		-1.9	%	586,138

	Total Liabilities and
	Shareholders' Equity	$5,529,463		$5,445,808		1.5	%	$5,577,844

12. Income Statements.
		*(unaudited, in thousands except per-share amounts)*
						%
		Q3'18		Q3'17		Change		Q2'18
	Interest & Fee Income:
	Loans	$14,593		$15,082		-3.2	%	$14,957
	Investment Securities:
	Equity Securities	85		70		21.0	%	86
	Debt Securities Available for Sale	15,644		11,277		38.7	%	14,323
	Debt Securities Held to Maturity	5,931		6,716		-11.7	%	6,216
	Total Interest & Fee Income	36,253		33,145		9.4	%	35,582

	Interest Expense:
	Transaction Deposits	129		60		115.7	%	60
	Savings Deposits	229		220		4.0	%	224
	Time Deposits	160		181		-11.8	%	165
	Short-Term Borrowed Funds	9		12		-22.3	%	10
	Total Interest Expense	527		473		11.4	%	459

	Net Interest Income	35,726		32,672		9.3	%	35,123

	Reversal of Provision for Loan Losses	-		-		n/m		-

	Noninterest Income:
	Service Charges	4,615		4,989		-7.5	%	4,645
	Merchant Processing Services	2,464		2,153		14.4	%	2,305
	Debit Card Fees	1,656		1,784		-7.2	%	1,698
	Other Service Fees	665		652		2.0	%	650
	ATM Processing Fees	687		684		0.5	%	698
	Trust Fees	733		718		2.0	%	726
	Life Insurance Gains	585		-		n/m		-
	Financial Services Commissions	132		148		-10.4	%	141
	Equity Securities Losses	(16	)	-		n/m		(14	)
	Other	1,007		1,420		-29.1	%	920
	Total Noninterest Income	12,528		12,548		-0.2	%	11,769

	Noninterest Expense:
	Salaries and Benefits	13,415		12,816		4.7	%	13,186
	Occupancy and Equipment	4,809		4,907		-2.0	%	4,864
	Loss Contingency (1)	3,500		-		n/m		-
	Outsourced Data Processing	2,292		2,383		-3.8	%	2,299
	Amortization of Identifiable Intangibles	451		760		-40.7	%	453
	Professional Fees	621		512		21.2	%	871
	Courier Service	448		451		-0.7	%	422
	Other	1,469		2,285		-35.7	%	1,882
	Total Noninterest Expense	27,005		24,114		12.0	%	23,977

	Income Before Income Taxes	21,249		21,106		0.7	%	22,915
	Income Tax Provision	4,256		6,089		-30.1	%	4,905
	Net Income	$16,993		$15,017		13.2	%	$18,010

	Average Common Shares Outstanding	26,701		26,309		1.5	%	26,630
	Diluted Common Shares Outstanding	26,815		26,404		1.6	%	26,728

	Per Common Share Data:
	Basic Earnings	$0.64		$0.57		12.3	%	$0.68
	Diluted Earnings	0.63		0.57		10.5	%	0.67
	Dividends Paid	0.40		0.39		2.6	%	0.40

						%
		9/30'18YTD		9/30'17YTD		Change
	Interest & Fee Income:
	Loans	$44,247		$46,330		-4.5	%
	Investment Securities:
	Equity Securities	256		214		19.4	%
	Debt Securities Available for Sale	43,518		32,091		35.6	%
	Debt Securities Held to Maturity	18,321		20,997		-12.7	%
	Total Interest & Fee Income	106,342		99,632		6.7	%

	Interest Expense:
	Transaction Deposits	249		174		43.5	%
	Savings Deposits	675		665		1.5	%
	Time Deposits	493		556		-11.4	%
	Short-Term Borrowed Funds	28		34		-17.5	%
	Total Interest Expense	1,445		1,429		1.1	%

	Net Interest Income	104,897		98,203		6.8	%

	Reversal of Provision for Loan Losses	-		(1,900	)	n/m

	Noninterest Income:
	Service Charges	14,012		14,857		-5.7	%
	Merchant Processing Services	7,190		6,080		18.2	%
	Debit Card Fees	4,959		4,851		2.2	%
	Other Service Fees	1,946		1,964		-0.9	%
	ATM Processing Fees	2,049		1,914		7.1	%
	Trust Fees	2,202		2,136		3.1	%
	Life Insurance Gains	585		-		n/m
	Financial Services Commissions	387		484		-20.0	%
	Equity Securities Losses	(66	)	-		n/m
	Other	2,988		4,042		-26.1	%
	Total Noninterest Income	36,252		36,328		-0.2	%

	Noninterest Expense:
	Salaries and Benefits	39,952		38,867		2.8	%
	Occupancy and Equipment	14,365		14,571		-1.4	%
	Outsourced Data Processing	6,930		6,710		3.3	%
	Loss Contingency (1)	3,500		-		n/m
	Amortization of Identifiable Intangibles	1,474		2,322		-36.5	%
	Professional Fees	2,277		1,533		48.5	%
	Courier Service	1,333		1,310		1.8	%
	Other	5,365		7,812		-31.3	%
	Total Noninterest Expense	75,196		73,125		2.8	%

	Income Before Income Taxes	65,953		63,306		4.2	%
	Income Tax Provision	13,444		17,441		-22.9	%
	Net Income	$52,509		$45,865		14.5	%

	Average Common Shares Outstanding	26,622		26,260		1.4	%
	Diluted Common Shares Outstanding	26,736		26,379		1.4	%

	Per Common Share Data:
	Basic Earnings	$1.97		$1.75		12.6	%
	Diluted Earnings	1.96		1.74		12.6	%
	Dividends Paid	1.20		1.17		2.6	%


	Footnotes and Abbreviations:
	(1) The Company achieved a mediated settlement to dismiss a lawsuit.
	Certain amounts in prior periods have been reclassified to conform to the current presentation.
	(FTE) Fully Taxable Equivalent. The Company presents its net interest margin and net interest income on a FTE basis using the current statutory federal tax rate. Management believes the FTE basis is valuable to the reader because the Company’s loan and investment securities portfolios contain a relatively large portion of municipal loans and securities that are federally tax exempt. The Company’s tax exempt loans and securities composition may not be similar to that of other banks, therefore in order to reflect the impact of the federally tax exempt loans and securities on the net interest margin and net interest income for comparability with other banks, the Company presents its net interest margin and net interest income on a FTE basis.
	(a) Annualized

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Westamerica Bancorporation Reports Third Quarter 2018 Financial Results

Distribution channels: Banking, Finance & Investment Industry

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