UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2019 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________. Commission file number: 001-09383 WESTAMERICA BANCORPORATION (Exact Name of Registrant as Specified in Its Charter) California ...

[PART I - FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [Financial Statements](index=4&type=section&id=Item%201%20Financial%20Statements) Unaudited consolidated financial statements for Westamerica Bancorporation as of June 30, 2019, are presented, including balance sheets, income statements, and cash flows Consolidated Balance Sheet Highlights (Unaudited) | Account | June 30, 2019 (In thousands) | December 31, 2018 (In thousands) | | :--- | :--- | :--- | | Total Assets | $5,523,448 | $5,568,526 | | Loans, net | $1,141,595 | $1,185,851 | | Total Deposits | $4,730,262 | $4,866,839 | | Total Liabilities | $4,830,011 | $4,952,935 | | Total Shareholders' Equity | $693,437 | $615,591 | Consolidated Income Statement Highlights (Unaudited) | Metric | Q2 2019 (In thousands) | Q2 2018 (In thousands) | H1 2019 (In thousands) | H1 2018 (In thousands) | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $39,139 | $36,887 | $78,128 | $72,743 | | Provision for Loan Losses | $0 | $0 | $0 | $0 | | Net Income | $19,625 | $18,010 | $39,271 | $35,516 | | Diluted EPS | $0.73 | $0.67 | $1.46 | $1.33 | Consolidated Cash Flow Highlights (Unaudited) | Cash Flow Activity | Six Months Ended June 30, 2019 (In thousands) | Six Months Ended June 30, 2018 (In thousands) | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $39,541 | $49,900 | | Net Cash Provided by (Used in) Investing Activities | $105,968 | $(53,386) | | Net Cash (Used in) Provided by Financing Activities | $(147,207) | $57,630 | [Note 2: Accounting Policies](index=9&type=section&id=Note%202%3A%20Accounting%20Policies) The company adopted new accounting standards in H1 2019 for leases and callable debt securities, recognizing a **$15.3 million** lease asset and liability, and is preparing for the CECL model - Effective January 1, 2019, the company adopted ASU 2016-02 (Leases), recognizing a lease liability and a corresponding right-of-use asset of **$15.3 million** for facilities leases[29](index=29&type=chunk)[30](index=30&type=chunk) - The company adopted ASU 2017-08, which shortens the amortization period for certain callable debt securities held at a premium, resulting in a **$3.1 million** reduction in investment securities and a **$2.8 million** reduction in retained earnings, net of tax[31](index=31&type=chunk)[33](index=33&type=chunk) - The company is preparing to adopt the new **CECL standard** (ASU 2016-13) on January 1, 2020, and expects to determine an aggregate loss estimate by year-end 2019[36](index=36&type=chunk)[37](index=37&type=chunk) [Note 3: Investment Securities](index=11&type=section&id=Note%203%3A%20Investment%20Securities) The investment securities portfolio totaled **$3.63 billion** at June 30, 2019, with no other-than-temporary impairments, primarily influenced by market interest rates Debt Securities Portfolio Summary (Amortized Cost) | Security Type | June 30, 2019 (In thousands) | December 31, 2018 (In thousands) | | :--- | :--- | :--- | | Debt securities available for sale | $2,757,267 | $2,711,453 | | Debt securities held to maturity | $867,989 | $984,609 | | **Total** | **$3,625,256** | **$3,696,062** | - **Unrealized losses** on debt securities were primarily caused by changes in market interest rates, with no intent or requirement to sell before recovery of amortized cost basis[47](index=47&type=chunk)[48](index=48&type=chunk) [Note 4: Loans, Allowance for Loan Losses and Other Real Estate Owned](index=18&type=section&id=Note%204%3A%20Loans%2C%20Allowance%20for%20Loan%20Losses%20and%20Other%20Real%20Estate%20Owned) The loan portfolio decreased to **$1.16 billion** at June 30, 2019, with the allowance for loan losses at **$20.1 million** and improved credit quality metrics Loan Portfolio Composition | Loan Category | June 30, 2019 (In thousands) | December 31, 2018 (In thousands) | | :--- | :--- | :--- | | Commercial | $243,577 | $275,080 | | Commercial Real Estate | $577,665 | $580,480 | | Construction | $5,482 | $3,982 | | Residential Real Estate | $37,813 | $44,866 | | Consumer Installment & Other | $297,175 | $302,794 | | **Total** | **$1,161,712** | **$1,207,202** | Allowance for Loan Losses Activity (H1 2019) | Metric | Amount (In thousands) | | :--- | :--- | | Balance at Dec 31, 2018 | $21,351 | | Provision for loan losses | $0 | | Net Charge-offs | $(1,234) | | **Balance at June 30, 2019** | **$20,117** | - Total nonaccrual loans decreased to **$3.8 million** at June 30, 2019, from **$4.9 million** at December 31, 2018[62](index=62&type=chunk)[63](index=63&type=chunk) [Note 10: Commitments and Contingent Liabilities](index=37&type=section&id=Note%2010%3A%20Commitments%20and%20Contingent%20Liabilities) The company reported **$276.2 million** in unfunded loan commitments, settled a lawsuit for **$252 thousand**, and increased customer refund liability to **$5.84 million** - Unfunded loan commitments stood at **$276.2 million** at June 30, 2019[115](index=115&type=chunk) - In Q2 2019, the company settled a lawsuit, paying a liability of **$252 thousand**[117](index=117&type=chunk)[240](index=240&type=chunk) - The company increased its liability for customer refunds related to prior years by **$301 thousand**, bringing the total estimated obligation to **$5.84 million**[118](index=118&type=chunk)[240](index=240&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=40&type=section&id=Item%202%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 2019 financial performance, highlighting a **9%** net income increase to **$19.6 million** driven by an expanded net interest margin of **3.13%**, strong credit quality, and robust capital Key Financial Performance Ratios | Ratio | Q2 2019 | Q2 2018 | | :--- | :--- | :--- | | Return on Assets | 1.42% | 1.29% | | Return on Common Equity | 11.75% | 11.55% | | Net Interest Margin (FTE) | 3.13% | 2.97% | | Efficiency Ratio | 48.6% | 51.4% | - Net income for Q2 2019 was **$19.6 million**, an increase of **$1.6 million** from Q2 2018, primarily due to a **$2.0 million** increase in net interest and loan fee income (FTE)[127](index=127&type=chunk)[134](index=134&type=chunk) - Credit quality remained solid, with nonperforming assets declining to **$4.1 million** at June 30, 2019, from **$6.0 million** at June 30, 2018, and no provision for loan losses recognized in H1 2019[129](index=129&type=chunk)[162](index=162&type=chunk) [Net Interest and Loan Fee Income (FTE)](index=42&type=section&id=Net%20Interest%20and%20Loan%20Fee%20Income%20(FTE)) Net interest income (FTE) increased by **$2.0 million** in Q2 2019, with the net interest margin expanding to **3.13%** due to higher asset yields and low funding costs Net Interest Margin (FTE) Components | Component | Q2 2019 | Q2 2018 | | :--- | :--- | :--- | | Yield on earning assets (FTE) | 3.17% | 3.01% | | Rate paid on interest-bearing liabilities | 0.08% | 0.07% | | **Net interest margin (FTE)** | **3.13%** | **2.97%** | - The increase in net interest income was primarily driven by higher yields on assets (rate effect), which contributed **$2.4 million**, while changes in asset volume had a negative impact of **$0.4 million**[158](index=158&type=chunk) [Loan Portfolio Credit Risk](index=51&type=section&id=Loan%20Portfolio%20Credit%20Risk) The company's conservative credit risk management resulted in nonperforming assets decreasing to **$4.1 million** and an adequate allowance for loan losses of **$20.1 million** Nonperforming Assets Trend | Category | June 30, 2019 (In thousands) | Dec 31, 2018 (In thousands) | | :--- | :--- | :--- | | Total nonaccrual loans | $3,847 | $4,868 | | Accruing loans 90+ days past due | $249 | $551 | | Other real estate owned | $43 | $350 | | **Total nonperforming assets** | **$4,139** | **$5,769** | - The allowance for loan losses decreased to **$20.1 million** at June 30, 2019, from **$21.4 million** at December 31, 2018, reflecting management's assessment of decreasing risk in several loan segments[197](index=197&type=chunk)[201](index=201&type=chunk) [Liquidity and Funding](index=56&type=section&id=Liquidity%20and%20Funding) The company maintains a strong liquidity position, primarily funded by stable, low-cost deposits and a **$3.6 billion** investment portfolio as a secondary source - The company's funding is highly stable, with customer deposits and shareholders' equity providing **98%** of funding for average total assets in H1 2019[215](index=215&type=chunk) - The investment securities portfolio of **$3.6 billion** provides a substantial secondary source of liquidity, with approximately **$747 million** pledged as collateral at June 30, 2019[216](index=216&type=chunk) [Capital Resources](index=57&type=section&id=Capital%20Resources) The company maintains a robust capital position, with shareholders' equity at **$693 million** and all regulatory capital ratios significantly exceeding 'well-capitalized' thresholds Regulatory Capital Ratios (Company) at June 30, 2019 | Ratio | Company Actual | Required for Adequacy* | | :--- | :--- | :--- | | Common Equity Tier 1 Capital | 17.18% | 7.00% | | Tier 1 Capital | 17.18% | 8.50% | | Total Capital | 17.88% | 10.50% | | Leverage Ratio | 10.19% | 4.00% | *Includes 2.5% capital conservation buffer - In the first six months of 2019, the company paid common dividends of **$22 million** (**$0.81 per share**) and repurchased **8,000 shares** for **$488 thousand**[223](index=223&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=59&type=section&id=Item%203%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's primary market risks are credit and interest rate risk, with no current use of derivative instruments for risk management - The most significant market risks are **credit risk** and **interest rate risk**[237](index=237&type=chunk) - The company does not currently engage in trading activities or use derivative instruments to control interest rate risk[236](index=236&type=chunk) [Controls and Procedures](index=59&type=section&id=Item%204%20Controls%20and%20Procedures) The company's disclosure controls and procedures were deemed effective as of June 30, 2019, with no material changes to internal control over financial reporting - The principal executive officer and principal financial officer concluded that the Company's disclosure controls and procedures are **effective** as of June 30, 2019[239](index=239&type=chunk) [PART II - OTHER INFORMATION](index=59&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [Legal Proceedings](index=59&type=section&id=Item%201%20Legal%20Proceedings) The company is not involved in material legal proceedings, having settled a lawsuit for **$252 thousand** and increased customer refund liability by **$301 thousand** in Q2 2019 - In Q2 2019, the Company settled a lawsuit for **$252 thousand** and increased a liability for customer refunds by **$301 thousand**[240](index=240&type=chunk) [Risk Factors](index=59&type=section&id=Item%201A%20Risk%20Factors) No material changes to the company's risk factors have occurred since the Form 10-K filing for the year ended December 31, 2018 - There have been no material changes to the Company's risk factors since the Form 10-K was filed for the year ended December 31, 2018[241](index=241&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=59&type=section&id=Item%202%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2019, the company repurchased **8,000 shares** of common stock at an average price of **$61.98** per share under its repurchase program Issuer Purchases of Equity Securities (Q2 2019) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2019 | 8,000 | $61.98 | | May 2019 | 0 | - | | June 2019 | 0 | - | | **Total** | **8,000** | **$61.98** |

Title of Class Shares outstanding as of April 30, 2019 Common Stock, 26,929,915 No Par Value Securities registered pursuant to Section 12(b) of the Exchange Act: Title of each class Trading Symbol(s) Name of each exchange on which registered Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. (C ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark one) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2018 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________ to______________. Commission File Number: 001-09383 WESTAMERICA BANCORPORATION (Exact name of the registrant as specified in its charter) CALIFORNIA ...