8-K 1 jan8k06.txt WESTAMERICA BANCORPORATION FORM 8-K 01-20-2006 Page 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): January 20, 2006 ---------------- WESTAMERICA BANCORPORATION -------------------------- (Exact Name of Registrant as Specified in Its Charter) CALIFORNIA ---------- (State or Other Jurisdiction of Incorporation) 001-9383 94-2156203 -------- ---------- (Commission File Number) (IRS Employer Identification No.) 1108 Fifth Avenue, San Rafael, California 94901 ---------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) (707) 863-6000 -------------- (Registrant's Telephone Number, Including Area Code) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c)) Page 2 Exhibits --------- 99.1 Press release dated January 19, 2006 Item 2.02: Results of Operations and Financial Condition ---------------------------------------------------------- On January 19, 2006 Westamerica Bancorporation announced their quarterly earnings for the fourth quarter of 2005. A copy of the press release is attached as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference. Page 3 Signatures Pursuant to the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Westamerica Bancorporation /s/ JOHN "ROBERT" THORSON ------------------------------------------------- John "Robert" Thorson Senior Vice President and Chief Financial Officer January 20, 2006 Page 4 INDEX TO EXHIBITS ----------------- Sequentially Exhibit No. Description Number Page ----------- ------------------------- ------------- (99.1) Press release dated 5-16 January 19, 2006 Page 5 FOR IMMEDIATE RELEASE January 19, 2006 WESTAMERICA BANCORPORATION REPORTS RECORD ANNUAL EARNINGS San Rafael, CA: Westamerica Bancorporation (NASDAQ: WABC), parent company of Westamerica Bank, today reported record net income for the year ended December 31, 2005 of $107.4 million, compared to $95.2 million for 2004. Diluted earnings per share (EPS) for 2005 were $3.27, an 11 percent increase over $2.93 for the year 2004. Results for the year 2005 include available-for-sale securities losses, gains on the sale of real estate, and company owned life insurance proceeds, which combined to increase net income $247 thousand. Results for the year 2004 included an impairment charge related to Freddie Mac and Fannie Mae preferred stock, which reduced net income $4.2 million, or EPS of $0.13. Return on shareholders' equity for the year 2005 was 26.0 percent and return on assets was 2.12 percent, compared to 28.8 percent and 2.10 percent, respectively, for the year 2004. For the year 2005, shareholder dividends totaled $1.22 per share, an 11 percent increase over $1.10 per share for the year 2004. "Fourth quarter 2005 results benefited from an increased net interest margin, strength in merchant card processing and debit card fees, and cost containment," said Chairman, President and CEO David Payne. "During the fourth quarter, our focus on reducing high-cost funding sources helped our net interest margin increase to 4.80 percent from 4.76 percent in the prior quarter. The March 2005 Redwood Empire Bancorp acquisition helped grow our fee income to 20 percent of revenues in 2005, while our efficiency ratio remains low at 37.7 percent. We are pleased to be generating a 26 percent return on our shareholders' equity," continued Payne. Page 6 Net income for the fourth quarter 2005 totaled $27.6 million, or EPS of $0.85. Fourth quarter results include company owned life insurance proceeds, which account for $0.01 EPS. Fourth quarter 2005 results compare to EPS of $0.89 for the third quarter 2005, which included a gain on the sale of a facility vacated following the Redwood Empire Bancorp acquisition and company owned life insurance proceeds combining to account for $0.06 EPS. Fourth quarter 2005 results also compare to EPS of $0.65 for the fourth quarter 2004, which included the impairment charge, which reduced EPS $0.13. Fourth quarter 2005 return on shareholders' equity was 26.0 percent and return on assets was 2.15 percent. Net interest income on a fully taxable equivalent basis was $55.8 million in the fourth quarter of 2005 compared to $56.0 million in the prior quarter and $54.6 million in the same quarter a year ago. The fourth quarter 2005 net interest margin on a taxable equivalent basis was 4.80 percent, compared to 4.76 percent for the previous quarter and 5.01 percent for the fourth quarter of 2004. For the full year 2005, net interest income and the net interest margin on a fully taxable equivalent basis were $223.9 million and 4.82 percent, compared to $218.0 million and 5.14 percent, respectively, for 2004. The provision for credit losses was $150 thousand for the fourth quarter of 2005, unchanged from the previous quarter and down from $600 thousand for the year ago quarter. The level of the credit loss provision reflects management's assessment of credit risk for the loan portfolio. Noninterest income in the fourth quarter of 2005 totaled $14.4 million, compared to $17.4 million reported in the previous quarter. The decrease from the prior quarter is primarily attributable to a third quarter $2.4 million gain on the sale of a facility vacated following the Redwood Empire Bancorp acquisition. Noninterest income for the fourth quarter 2005 increased $10.2 million from noninterest income for the fourth quarter 2004. The fourth quarter 2004 included a $7.2 million "other than temporary impairment" charge for Freddie Mac and Fannie Mae preferred stock. The remaining $3.0 million increase in fourth quarter 2005 noninterest income from fourth quarter 2004 levels is primarily attributable to higher merchant card processing fees, service charges on deposit accounts, and debit card income. For the full year 2005, noninterest income increased to $54.5 million from $38.6 million for 2004. Of the $15.9 million annual increase, $6.9 million of the increase is attributable to the 2004 impairment charge and the 2005 securities losses, gains from the sale of real estate and company owned life insurance proceeds. The remaining $9.0 million increase in noninterest income from the prior year is primarily attributable to higher merchant card processing fees, debit card income, service charges on deposit accounts, and ATM fees. Page 7 Noninterest expense for the fourth quarter of 2005 totaled $26.2 million compared to $26.8 million in the prior quarter and $24.3 million in the year ago quarter. The decrease from the prior quarter is primarily attributable to lower salaries and benefits. The increase from the year ago quarter is primarily attributable to higher amortization of intangible assets, personnel costs, and occupancy expense as a result of the Redwood Empire Bancorp acquisition. For the full year, noninterest expense was $104.9 million, up six percent from $98.8 million for 2004. The increase is primarily attributable to higher amortization of intangible assets, salaries and benefits, occupancy and equipment expense, and professional fees. Shareholders' equity was $427 million at December 31, 2005, and the equity-to- asset ratio was 8.3 percent. At December 31, 2005, there were approximately 1.5 million shares remaining to purchase under the Company's existing share repurchase program. At December 31, 2005, the Company had total assets of $5.1 billion and total loans outstanding of $2.7 billion. Westamerica Bancorporation, through its wholly owned subsidiary Westamerica Bank, operates 87 branches throughout 21 Northern and Central California counties. Westamerica Bancorporation Web Address: www.westamerica.com For additional information contact: Westamerica Bancorporation Robert A. Thorson - SVP & Chief Financial Officer 707-863-6840 Page 8 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 annual and quarterly reports filed with the Securities and Exchange Commission, including the Company's Form 10-Q for the quarter ended September 30, 2005 and Form 10-K for the year ended December 31, 2004, describe some of these factors, including certain credit, market, operational, liquidity and interest rate 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 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. ##### Page 9 WESTAMERICA BANCORPORATION Public Information January 19, 2006 FINANCIAL HIGHLIGHTS December 31, 2005 1. Net Income Summary.
(dollars in thousands except per-share data) Q4'05 / Q4'05 / 12/31'05YTD / Q4'05 Q4'04 Q4'04 Q3'05 Q3'05 12/31'05YTD12/31'04YTD12/31'04YTD --------------------------------------------------------------------------------------- 1. Net Interest Income $55,830 $54,587 2.3% $55,993 -0.3% $223,866 $217,993 2.7% (Fully Taxable Equivalent) 2. Provision for Credit Losses 150 600 -75.0% 150 0.0% 900 2,700 -66.7% 3. Noninterest Income: 4. Investment Securities 0 (7,180) n/m 0 n/m (4,903) (5,011) -2.2% (Loss/Impairment) Gains 5. Loss on Extinguishment 0 0 n/m 0 n/m 0 (2,204) n/m of Debt 6. Other 14,427 11,449 26.0% 17,440 -17.3% 59,443 45,798 29.8% ----------------------- ------------ ----------------------- 7. Total Noninterest Income 14,427 4,269 237.9% 17,440 -17.3% 54,540 38,583 41.4% ----------------------- ------------ ----------------------- 8. Noninterest Expense 26,168 24,277 7.8% 26,791 -2.3% 104,856 98,751 6.2% 9. Income Tax Provision (FTE) 16,340 12,814 27.5% 17,298 -5.5% 65,209 59,907 8.9% ----------------------- ------------ ----------------------- 10.Net Income $27,599 $21,165 30.4% $29,194 -5.5% $107,441 $95,218 12.8% ======================= ============ ======================= 11.Average Shares Outstanding 32,029 31,761 0.8% 32,352 -1.0% 32,291 31,821 1.5% 12.Diluted Average Shares 32,572 32,487 0.3% 32,972 -1.2% 32,897 32,461 1.3% Outstanding 13.Operating Ratios: 14. Basic Earnings Per Share $0.86 $0.67 29.3% $0.90 -4.5% $3.33 $2.99 11.2% 15. Diluted Earnings Per Share 0.85 0.65 30.1% 0.89 -4.3% 3.27 2.93 11.3% 16. Return On Assets 2.15% 1.81% 2.25% 2.12% 2.10% 17. Return On Equity 26.0% 24.0% 27.3% 26.0% 28.8% 18. Net Interest Margin (FTE) 4.80% 5.01% 4.76% 4.82% 5.14% 19. Efficiency Ratio (FTE) 37.2% 41.2% 36.5% 37.7% 38.5% 20.Dividends Paid Per Share $0.32 $0.28 14.3% $0.30 6.7% $1.22 $1.10 10.9% 21.Dividend Payout Ratio 38% 43% 34% 37% 38% (FTE) Dollar amount or ratio on a fully-taxable equivalent basis.
2. Net Interest Income.
(dollars in thousands) Q4'05 / Q4'05 / 12/31'05YTD / Q4'05 Q4'04 Q4'04 Q3'05 Q3'05 12/31'05YTD12/31'04YTD12/31'04YTD --------------------------------------------------------------------------------------- 1. Interest and Fee Income (FTE) $68,349 $60,540 12.9% $68,021 0.5% $267,515 $239,099 11.9% 2. Interest Expense 12,519 5,953 110.3% 12,028 4.1% 43,649 21,106 106.8% ----------------------- ------------ ----------------------- 3. Net Interest Income (FTE) $55,830 $54,587 2.3% $55,993 -0.3% $223,866 $217,993 2.7% ======================= ============ ======================= 4. Average Earning Assets $4,639,319 $4,352,493 6.6%$4,695,342 -1.2%$4,643,307 $4,236,903 9.6% 5. Average Interest-Bearing 3,168,720 2,912,943 8.8% 3,266,697 -3.0% 3,218,151 2,886,233 11.5% Liabilities 6. Yield on Earning Assets (FTE) 5.87% 5.55% 5.77% 5.76% 5.64% 7. Cost of Funds 1.07% 0.54% 1.01% 0.94% 0.50% 8. Net Interest Margin (FTE) 4.80% 5.01% 4.76% 4.82% 5.14% 9. Interest Expense/Interest- 1.56% 0.81% 1.45% 1.36% 0.73% Bearing Liabilities 10.Net Interest Spread (FTE) 4.31% 4.74% 4.32% 4.40% 4.91% (FTE) Dollar amount, margin, or spread on a fully-taxable equivalent basis.
Page 10 WESTAMERICA BANCORPORATION Public Information January 19, 2006 3. Loans & Other Earning Assets.
(average volume, dollars in thousands) Q4'05 / Q4'05 / 12/31'05YTD / Q4'05 Q4'04 Q4'04 Q3'05 Q3'05 12/31'05YTD12/31'04YTD12/31'04YTD --------------------------------------------------------------------------------------- 1. Total Assets $5,089,078 $4,653,950 9.3%$5,141,666 -1.0%$5,066,351 $4,536,452 11.7% 2. Total Earning Assets 4,639,319 4,352,493 6.6% 4,695,342 -1.2% 4,643,307 4,236,903 9.6% 3. Total Loans 2,616,813 2,235,375 17.1% 2,643,270 -1.0% 2,576,363 2,258,482 14.1% 4. Commercial Loans 698,375 620,309 12.6% 711,330 -1.8% 694,212 621,258 11.7% 5. Commercial Real Estate Loans 921,141 740,909 24.3% 937,380 -1.7% 906,315 769,533 17.8% 6. Consumer Loans 997,297 874,157 14.1% 994,560 0.3% 975,836 867,691 12.5% 7. Total Investment Securities 2,022,506 2,117,118 -4.5% 2,052,072 -1.4% 2,066,944 1,978,421 4.5% 8. Available For Sale 670,499 941,614 -28.8% 681,098 -1.6% 728,649 1,096,789 -33.6% (Market Value) 9. Held To Maturity 1,352,007 1,175,504 15.0% 1,370,974 -1.4% 1,338,295 881,632 51.8% 10. HTM Unrealized (Loss) (13,434) 5,154 n/m (8,157) n/m (13,434) 5,154 n/m Gain at Period-End 11.Loans / Deposits 67.1% 60.1% 68.3% 66.9% 63.3%
4. Deposits & Other Interest-Bearing Liabilities.
(average volume, dollars in thousands) Q4'05 / Q4'05 / 12/31'05YTD / Q4'05 Q4'04 Q4'04 Q3'05 Q3'05 12/31'05YTD12/31'04YTD12/31'04YTD --------------------------------------------------------------------------------------- 1. Total Deposits $3,898,859 $3,718,114 4.9%$3,872,414 0.7%$3,848,675 $3,565,308 7.9% 2. Noninterest Demand 1,435,193 1,354,129 6.0% 1,400,272 2.5% 1,384,483 1,281,349 8.0% 3. Interest-Bearing Transaction 655,109 588,362 11.3% 632,680 3.5% 632,897 577,296 9.6% 4. Savings 1,073,971 1,139,713 -5.8% 1,104,237 -2.7% 1,105,664 1,085,051 1.9% 5. Other Time >$100K 470,016 373,846 25.7% 455,293 3.2% 444,862 350,400 27.0% 6. Other Time < $100K 264,570 262,064 1.0% 279,932 -5.5% 280,769 271,212 3.5% 7. Total Short-Term Borrowings 664,752 527,529 26.0% 754,215 -11.9% 716,984 556,415 28.9% 8. Fed Funds Purchased 480,649 369,986 29.9% 585,156 -17.9% 550,523 360,771 52.6% 9. Other Short-Term Funds 184,103 157,543 16.9% 169,059 8.9% 166,461 195,644 -14.9% 10.FHLB Debt 0 0 n/m 0 n/m 0 24,153 n/m 11.Long-Term Debt 40,302 21,429 88.1% 40,340 -0.1% 36,975 21,706 70.3% 12.Shareholders' Equity 421,536 350,151 20.4% 424,277 -0.6% 412,559 330,330 24.9% 13.Demand Deposits / Total Deposits 36.8% 36.4% 36.2% 36.0% 35.9% 14.Transaction & Savings 81.2% 82.9% 81.0% 81.1% 82.6% Deposits / Total Deposits
Page 11 WESTAMERICA BANCORPORATION Public Information January 19, 2006 5. Interest Yields Earned & Rates Paid.
(dollars in thousands) Q4'05 Q4'04 ------------------------------- Q3'05 --------------------------------- 2004 Average Income/ Yield/ Yield/ Average Income/ Yield/ Yield/ Volume Expense Rate Rate Volume Expense Rate Rate --------------------------------------------------------------------------------------- 1. Interest & Fees Income Earned 2. Total Earning Assets (FTE) $4,639,319 $68,349 5.87% 5.77%$4,352,493 $60,540 5.55% 5.64% 3. Total Loans (FTE) 2,616,813 41,971 6.36% 6.21% 2,235,375 34,297 6.10% 6.14% 4. Commercial Loans (FTE) 698,375 13,027 7.32% 6.92% 620,309 9,959 6.34% 6.09% 5. Commercial Real Estate Loans 921,141 16,580 7.14% 7.12% 740,909 13,793 7.41% 7.45% 6. Consumer Loans 997,297 12,364 5.03% 4.93% 874,157 10,545 4.91% 5.07% 7. Total Investment Securities 2,022,506 26,378 5.22% 5.19% 2,117,118 26,243 4.96% 5.07% (FTE) 8. Interest Expense Paid 9. Total Earning Assets 4,639,319 12,519 1.07% 1.01% 4,352,493 5,953 0.54% 0.50% 10. Total Interest-Bearing 3,168,720 12,519 1.56% 1.45% 2,912,943 5,953 0.81% 0.73% Liabilities 11. Total Interest-Bearing 2,463,666 6,586 1.06% 0.96% 2,363,985 3,649 0.61% 0.57% Deposits 12. Interest-Bearing 655,109 457 0.28% 0.25% 588,362 213 0.14% 0.11% Transaction 13. Savings 1,073,971 953 0.35% 0.34% 1,139,713 874 0.31% 0.36% 14. Other Time < $100K 264,570 1,444 2.17% 2.07% 262,064 1,081 1.64% 1.49% 15. Other Time >$100K 470,016 3,732 3.15% 2.74% 373,846 1,481 1.58% 1.27% 16. Total Short-Term Borrowings 664,752 5,296 3.12% 2.81% 527,529 1,988 1.48% 1.06% 17. Fed Funds Purchased 480,649 4,888 3.98% 3.45% 369,986 1,874 1.98% 1.38% 18. Other Short-Term Funds 184,103 408 0.88% 0.60% 157,543 114 0.29% 0.45% 19. FHLB Debt 0 0 0.00% 0.00% 0 0 0.00% 3.65% 20. Long-Term Debt 40,302 637 6.32% 6.35% 21,429 316 5.90% 5.91% 21.Net Interest Income and Margin (FTE) $55,830 4.80% 4.76% $54,587 5.01% 5.14% (FTE) Income, yield, or margin on a fully-taxable equivalent basis.
6. Noninterest Income.
(dollars in thousands) Q4'05 / Q4'05 / 12/31'05YTD / Q4'05 Q4'04 Q4'04 Q3'05 Q3'05 12/31'05YTD12/31'04YTD12/31'04YTD --------------------------------------------------------------------------------------- 1. Service Charges on Deposit $7,202 $6,928 4.0% $7,436 -3.1% $29,106 $28,621 1.7% Accounts 2. Merchant Credit Card Income 2,751 875 214.4% 2,631 4.6% 9,097 3,509 159.2% 3. ATM Fees & Interchange 653 597 9.4% 725 -9.9% 2,711 2,487 9.0% 4. Debit Card Fees 865 700 23.6% 834 3.7% 3,207 2,541 26.2% 5. Financial Services Fees 380 294 29.3% 388 -2.1% 1,387 1,250 11.0% 6. Mortgage Banking Income 62 82 -24.4% 62 0.0% 292 386 -24.4% 7. Trust Fees 275 254 8.3% 323 -14.9% 1,181 1,027 15.0% 8. Other Income 2,239 1,719 30.3% 2,672 -16.2% 8,762 5,977 46.6% ----------------------- ------------ ----------------------- 9. Sub-total 14,427 11,449 26.0% 15,071 -4.3% 55,743 45,798 21.7% 10 Gains on Sales of Real Property 0 0 n/m 2,369 -100.0% 3,700 0 n/m 11 Investment Securities 0 (7,180) n/m 0 n/m (4,903) (5,011) -2.2% Gains (Losses) 12 Loss on Extinguishment of Debt 0 0 n/m 0 n/m 0 (2,204) n/m 13 Total Noninterest Income $14,427 $4,269 237.9% $17,440 -17.3% $54,540 $38,583 41.4% ======================= ============ ======================= 14 Operating Ratios: 15 Total Revenue (FTE) $70,257 $58,856 19.4% $73,433 -4.3% $278,406 $256,576 8.5% 16 Noninterest Income / Revenue 20.5% 7.3% 23.7% 19.6% 15.0% (FTE) 17 Service Charges / Deposits 0.73% 0.74% 0.76% 0.76% 0.80% (annualized) 18 Total Revenue Per Share $8.70 $7.37 18.0% $9.01 -3.4% $8.62 $8.06 6.9% (annualized) (FTE) Dollar amount on a fully-taxable equivalent basis.
Page 12 WESTAMERICA BANCORPORATION Public Information January 19, 2006 7. Noninterest Expense.
(dollars in thousands) Q4'05 / Q4'05 / 12/31'05YTD / Q4'05 Q4'04 Q4'04 Q3'05 Q3'05 12/31'05YTD12/31'04YTD12/31'04YTD --------------------------------------------------------------------------------------- 1. Salaries & Benefits $13,055 $12,595 3.7% $13,621 -4.2% $53,460 $52,507 1.8% 2. Occupancy 3,196 3,022 5.8% 3,201 -0.2% 12,579 11,935 5.4% 3. Equipment 1,321 1,259 4.9% 1,347 -1.9% 5,212 4,794 8.7% 4. Data Processing 1,524 1,494 2.0% 1,544 -1.3% 6,156 6,057 1.6% 5. Courier 952 910 4.6% 989 -3.7% 3,831 3,605 6.3% 6. Postage 441 361 22.2% 377 17.0% 1,615 1,407 14.8% 7. Telephone 497 476 4.4% 537 -7.4% 2,115 2,112 0.1% 8. Professional Fees 599 537 11.5% 497 20.5% 2,420 1,869 29.5% 9. Stationery & Supplies 314 351 -10.5% 298 5.4% 1,264 1,280 -1.3% 10.Loan Expense 200 237 -15.6% 309 -35.3% 945 1,077 -12.3% 11.Merchant Card Expense 243 270 -10.0% 272 -10.7% 1,035 1,104 -6.3% 12.Operational Losses 303 217 39.6% 222 36.5% 915 964 -5.1% 13.Amortization of Identifiable 1,064 136 n/m 1,064 0.0% 3,625 543 n/m Intangibles 14.Other Operating 2,459 2,412 1.9% 2,513 -2.1% 9,684 9,497 2.0% ----------------------- ------------ ----------------------- 15.Total Noninterest Expense $26,168 $24,277 7.8% $26,791 -2.3% $104,856 $98,751 6.2% ======================= ============ ======================= 16.Full Time Equivalent (FTE) Staff 945 960 -1.6% 956 -1.2% 959 984 -2.5% 17.Average Assets / Full Time $5,385 $4,848 11.1% $5,378 0.1% $5,283 $4,610 14.6% Equivalent Staff 18.Operating Ratios: 19. FTE Revenue / Full Time $295 $244 20.9% $305 -3.2% $290 $261 11.3% Equivalent Staff (annualized) 20. Noninterest Expense / 2.24% 2.22% 2.26% 2.26% 2.33% / Earning Assets (annualized) 21. Noninterest Expense / Revenue 37.2% 41.2% 36.5% 37.7% 38.5%
Page 13 WESTAMERICA BANCORPORATION Public Information January 19, 2006 8. Provision for Credit Losses.
(dollars in thousands) Q4'05 / Q4'05 / 12/31'05YTD / Q4'05 Q4'04 Q4'04 Q3'05 Q3'05 12/31'05YTD12/31'04YTD12/31'04YTD --------------------------------------------------------------------------------------- 1. Provision for Credit Losses $150 $600 -75.0% $150 0.0% $900 $2,700 -66.7% 2. Gross Loan Losses 701 1,596 -56.1% 684 2.5% 2,738 5,593 -51.0% 3. Net Loan Losses 287 836 -65.7% 338 -15.1% 728 2,458 -70.4% 4. Recoveries / Gross Loan Losses 59% 48% 51% 73% 56% 5. Average Total Loans $2,616,813 $2,235,375 17.1%$2,643,270 -1.0%$2,576,363 $2,258,482 14.1% 6. Net Loan Losses / Loans 0.04% 0.15% 0.05% 0.03% 0.11% Net Loan Losses / Loans (annualized) 7. Provision for Credit Losses / 0.02% 0.11% 0.02% 0.03% 0.12% Loans (annualized) 8. Provision for Credit Losses / 52.3% 71.8% 44.4% 123.6% 109.8% Net Loan Losses
9. Credit Quality.
(dollars in thousands) 12/31/05 / 12/31/05 / 12/31/05 12/31/04 12/31/04 9/30/05 9/30/05 6/30/05 3/31/05 9/30/04 --------------------------------------------------------------------------------------- 1. Nonperforming Nonaccrual Loans $2,068 $2,970 -30.4% $2,292 -9.8% $1,560 $1,766 $3,996 2. Performing Nonaccrual Loans 4,256 4,071 4.5% 4,514 -5.7% 6,072 6,550 2,777 ----------------------- ------------ ---------------------------------- 3. Total Nonaccrual Loans 6,324 7,041 -10.2% 6,806 -7.1% 7,632 8,316 6,773 4. Accruing Loans 90+ Days Past Due 162 10 n/m 1,334 n/m 84 107 182 ----------------------- ------------ ---------------------------------- 5. Total Nonperforming Loans 6,486 7,051 -8.0% 8,140 -20.3% 7,716 8,423 6,955 6. Repossessed Collateral 0 0 n/m 0 n/m 40 0 0 7. Total Nonperforming Loans & ----------------------- ------------ ---------------------------------- 8. Repossessed Collateral $6,486 $7,051 -8.0% $8,140 -20.3% $7,756 $8,423 $6,955 ======================= ============ ================================== 9. Classified Loans $29,997 $19,225 56.0% $36,656 -18.2% $37,615 $35,258 $20,868 ======================= ============ ================================== 10.Allowance for Loan Losses $55,849 $54,152 3.1% $59,674 -6.4% $59,862 $59,859 $54,388 11.Total Loans Outstanding 2,672,221 2,300,230 16.2% 2,675,907 -0.1% 2,687,566 2,708,052 2,301,991 12.Total Assets 5,149,209 4,737,268 8.7% 5,153,091 -0.1% 5,191,093 5,192,111 4,636,071 13.Allowance for Loan Losses / 2.09% 2.35% 2.23% 2.23% 2.21% 2.36% Total Loans 14.Nonperforming Loans / Total Loans 0.24% 0.31% 0.30% 0.29% 0.31% 0.30% 15.Nonperforming Loans & Repossessed 16. Collateral/Total Assets 0.13% 0.15% 0.16% 0.15% 0.16% 0.15% 17.Allowance/Nonperforming Loans 861% 768% 733% 776% 711% 782% 18.Allowance for Loan Losses / 186% 282% 163% 159% 170% 261% Classified Loans 19.Classified Loans / 20. (Equity + Allowance 6.2% 4.7% 7.5% 7.5% 7.1% 5.1% for Loan Losses)
Page 14 WESTAMERICA BANCORPORATION Public Information January 19, 2006 10.Capital.
(dollars in thousands, except per-share amounts) 12/31/05 / 12/31/05 / 12/31/05 12/31/04 12/31/04 9/30/05 9/30/05 6/30/05 3/31/05 9/30/04 --------------------------------------------------------------------------------------- 1. Shareholders' Equity $426,714 $358,609 19.0% $432,024 -1.2% $439,617 $437,575 $351,924 2. Tier I Regulatory Capital 296,746 327,070 -9.3% 297,896 -0.4% 299,003 297,791 321,700 3. Total Regulatory Capital 339,881 367,333 -7.5% 341,147 -0.4% 342,967 342,146 361,586 4. Total Assets 5,149,209 4,737,268 8.7% 5,153,091 -0.1% 5,191,093 5,192,111 4,636,071 5. Risk-Adjusted Assets 3,267,226 2,948,797 10.8% 3,275,611 -0.3% 3,307,055 3,329,316 2,942,140 6. Shareholders' Equity / 8.29% 7.57% 8.38% 8.47% 8.43% 7.59% Total Assets 7. Shareholders' Equity / 15.97% 15.59% 16.14% 16.36% 16.16% 15.29% Total Loans 8. Tier I Capital /Total Assets 5.76% 6.90% 5.78% 5.76% 5.74% 6.94% 9. Tier I Capital / 9.08% 11.09% 9.09% 9.04% 8.94% 10.93% Risk-Adjusted Assets 10.Total Capital / 10.40% 12.46% 10.41% 10.37% 10.28% 12.29% Risk-Adjusted Assets 11.Shares Outstanding 31,882 31,640 0.8% 32,198 -1.0% 32,593 32,939 31,716 12.Book Value Per Share ($) $13.38 $11.33 18.1% $13.42 -0.3% $13.49 $13.28 $11.10 13.Market Value Per Share ($) 53.07 58.31 -9.0% 51.65 2.7% 52.81 51.77 54.89
14.Share Repurchase Programs
(shares in thousands) Q4'05 / Q4'05 / 12/31'05YTD / Q4'05 Q4'04 Q4'04 Q3'05 Q3'05 12/31'05YTD12/31'04YTD12/31'04YTD --------------------------------------------------------------------------------------- 15.Total Shares Repurchased / 500 242 106.6% 437 14.4% 1,794 1,062 68.9% Canceled 16. Average Repurchase Price $52.91 $58.85 -10.1% $53.60 -1.3% $52.99 $52.00 1.9% 17.Net Shares Repurchased (Issued) 316 76 n/m 395 n/m (242) 647 n/m
Page 15 WESTAMERICA BANCORPORATION Public Information January 19, 2006 11.Period-End Balance Sheets.
(dollars in thousands) 12/31/05 / 12/31/05 / 12/31/05 12/31/04 12/31/04 9/30/05 9/30/05 6/30/05 3/31/05 9/30/04 --------------------------------------------------------------------------------------- 1. Assets: 2. Cash and Money Market Assets $209,807 $126,687 65.6% $193,760 8.3% $195,289 $168,881 $165,811 3. Investment Securities 662,388 931,710 -28.9% 660,630 0.3% 691,609 719,097 967,266 Available For Sale 4. Investment Securities 1,337,216 1,260,832 6.1% 1,358,266 -1.5% 1,349,555 1,331,870 1,080,392 Held to Maturity 5. Loans, gross 2,672,221 2,300,230 16.2% 2,675,907 -0.1% 2,687,566 2,708,052 2,301,991 6. Allowance For Loan Losses (55,849) (54,152) 3.1% (59,674) -6.4% (59,862) (59,859) (54,388) ----------------------- ------------ ---------------------------------- 7. Loans, net 2,616,372 2,246,078 16.5% 2,616,233 0.0% 2,627,704 2,648,193 2,247,603 ----------------------- ------------ ---------------------------------- 9. Premises and Equipment 33,221 35,223 -5.7% 33,640 -1.2% 34,864 35,586 35,267 10. Identifiable Intangible Assets 26,170 2,894 n/m 27,233 -3.9% 28,297 29,389 3,030 11. Goodwill 121,907 18,996 n/m 124,122 -1.8% 124,122 127,503 18,996 12. Interest Receivable 142,128 114,848 23.8% 139,207 2.1% 139,653 131,592 117,706 and Other Assets ----------------------- ------------ ---------------------------------- 13.Total Assets $5,149,209 $4,737,268 8.7%$5,153,091 -0.1%$5,191,093 $5,192,111 $4,636,071 ======================= ============ ================================== 14.Liabilities and Shareholders' Equity: 15. Deposits: 16. Noninterest Bearing $1,419,313 $1,273,825 11.4%$1,412,470 0.5%$1,377,680 $1,371,819 $1,323,446 17. Interest-Bearing Transaction 658,667 591,593 11.3% 635,019 3.7% 614,246 626,693 561,206 18. Savings 1,022,645 1,091,981 -6.3% 1,094,130 -6.5% 1,114,631 1,166,858 1,119,356 19. Time 745,476 626,220 19.0% 732,316 1.8% 726,283 773,473 641,798 ----------------------- ------------ ---------------------------------- 20. Total Deposits 3,846,101 3,583,619 7.3% 3,873,935 -0.7% 3,832,840 3,938,843 3,645,806 ----------------------- ------------ ---------------------------------- 21. Short-Term Borrowed Funds 775,173 735,423 5.4% 764,143 1.4% 828,280 710,530 578,285 22. FHLB Debt 0 0 n/m 0 n/m 0 0 0 24. Debt Financing and 40,281 21,429 88.0% 40,318 -0.1% 40,354 40,391 21,429 Notes Payable 25. Liability For Interest, 60,940 38,188 59.6% 42,671 42.8% 50,002 64,772 38,627 Taxes and Other ----------------------- ------------ ---------------------------------- 26.Total Liabilities 4,722,495 4,378,659 7.9% 4,721,067 0.0% 4,751,476 4,754,536 4,284,147 ----------------------- ------------ ---------------------------------- 27.Shareholders' Equity: 28. Paid-In Capital $316,382 $229,975 37.6% $316,597 -0.1% $319,103 $319,438 $224,489 29. Unrealized Gain (Loss) on 30. Investment Securities 1,882 9,638 n/m 2,762 -31.9% 8,185 3,511 8,185 Available For Sale 31. Retained Earnings 108,450 118,996 -8.9% 112,665 -3.7% 112,329 114,626 119,250 ----------------------- ------------ ---------------------------------- 32.Total Shareholders' Equity 426,714 358,609 19.0% 432,024 -1.2% 439,617 437,575 351,924 ----------------------- ------------ ---------------------------------- 33.Total Liabilities and $5,149,209 $4,737,268 8.7%$5,153,091 -0.1%$5,191,093 $5,192,111 $4,636,071 Shareholders' Equity ======================= ============ ==================================
Page 16 WESTAMERICA BANCORPORATION Public Information January 19, 2006 12.Income Statements.
(amounts in thousands, except per-share amounts) Q4'05 / Q4'05 / 12/31'05YTD / Q4'05 Q4'04 Q4'04 Q3'05 Q3'05 12/31'05YTD12/31'04YTD12/31'04YTD --------------------------------------------------------------------------------------- 1. Interest and Fee Income: 2. Loans $40,593 $32,889 23.4% $40,008 1.5% $155,476 $133,226 16.7% 3. Money Market Assets 1 1 n/m 1 n/m 3 1 n/m and Funds Sold 4. Investment Securities 7,638 10,096 -24.3% 7,705 -0.9% 32,885 47,744 -31.1% Available For Sale 5. Investment Securities 14,002 11,764 19.0% 14,090 -0.6% 54,433 35,366 53.9% Held to Maturity ----------------------- ------------ ----------------------- 6. Total Interest Income 62,234 54,750 13.7% 61,804 0.7% 242,797 216,337 12.2% ----------------------- ------------ ----------------------- 7. Interest Expense: 8. Transaction Deposits 457 213 114.6% 401 14.0% 1,460 612 138.6% 9. Savings Deposits 953 874 9.0% 956 -0.3% 3,744 3,931 -4.8% 10. Time Deposits 5,176 2,562 102.0% 4,610 12.3% 17,160 8,504 101.8% 11. Short-Term Borrowed Funds 5,296 1,988 166.4% 5,421 -2.3% 18,941 5,878 222.2% 12. Federal Home Loan Bank 0 0 n/m 0 n/m 0 897 n/m Advances 13. Debt Financing and 637 316 101.6% 640 -0.5% 2,344 1,284 82.6% Notes Payable ----------------------- ------------ ----------------------- 14.Total Interest Expense 12,519 5,953 110.3% 12,028 4.1% 43,649 21,106 106.8% ----------------------- ------------ ----------------------- 15.Net Interest Income 49,715 48,797 1.9% 49,776 -0.1% 199,148 195,231 2.0% ----------------------- ------------ ----------------------- 16.Provision for Credit Losses 150 600 -75.0% 150 0.0% 900 2,700 -66.7% ----------------------- ------------ ----------------------- 17.Noninterest Income: 18. Service Charges on Deposit 7,202 6,928 4.0% 7,436 -3.1% 29,106 28,621 1.7% Accounts 19. Merchant Credit Card 2,751 875 214.4% 2,631 4.6% 9,097 3,509 159.2% 20. Financial Services Commissions 380 294 29.3% 388 -2.1% 1,387 1,250 11.0% 21. Mortgage Banking 62 82 -24.4% 62 0.0% 292 386 -24.4% 22. Trust Fees 275 254 8.3% 323 -14.9% 1,181 1,027 15.0% 23. Gains on Sales of Real Property 0 0 n/m 2,369 -100.0% 3,700 0 n/m 24. Securities Gains (Losses) 0 (7,180) n/m 0 n/m (4,903) (5,011) -2.2% 25. Loss on Extinguishment of Debt 0 0 n/m 0 n/m 0 (2,204) n/m 26. Other 3,757 3,016 24.6% 4,231 -11.2% 14,680 11,005 33.4% ----------------------- ------------ ----------------------- 27.Total Noninterest Income 14,427 4,269 237.9% 17,440 -17.3% 54,540 38,583 41.4% ----------------------- ------------ ----------------------- 28.Noninterest Expense: 29. Salaries and Related Benefits 13,055 12,595 3.7% 13,621 -4.2% 53,460 52,507 1.8% 30. Occupancy 3,196 3,022 5.8% 3,201 -0.2% 12,579 11,935 5.4% 31. Equipment 1,321 1,259 4.9% 1,347 -1.9% 5,212 4,794 8.7% 32. Data Processing 1,524 1,494 2.0% 1,544 -1.3% 6,156 6,057 1.6% 33. Professional Fees 599 537 11.5% 497 20.5% 2,420 1,869 29.5% 34. Other 6,473 5,370 20.5% 6,581 -1.6% 25,029 21,589 15.9% ----------------------- ------------ ----------------------- 35.Total Noninterest Expense 26,168 24,277 7.8% 26,791 -2.3% 104,856 98,751 6.2% ----------------------- ------------ ----------------------- 36.Income Before Income Taxes 37,824 28,189 34.2% 40,275 -6.1% 147,932 132,363 11.8% 37.Provision for income taxes 10,225 7,024 45.6% 11,081 -7.7% 40,491 37,145 9.0% ----------------------- ------------ ----------------------- 38.Net Income $27,599 $21,165 30.4% $29,194 -5.5% $107,441 $95,218 12.8% ======================= ============ ======================= 39.Average Shares Outstanding 32,029 31,761 0.8% 32,352 -1.0% 32,291 31,821 1.5% 40.Diluted Average Shares 32,572 32,487 0.3% 32,972 -1.2% 32,897 32,461 1.3% Outstanding 41.Per Share Data: 42. Basic Earnings $0.86 $0.67 29.3% $0.90 -4.5% $3.33 $2.99 11.2% 43. Diluted Earnings 0.85 0.65 30.1% 0.89 -4.3% 3.27 2.93 11.3% 44. Dividends Paid 0.32 0.28 14.3% 0.30 6.7% 1.22 1.10 10.9%