Financial Data and Key Metrics Changes - West Bancorporation reported a net income of $8 million for Q2 2025, an increase from $7.8 million in Q1 2025 and $5.2 million in Q2 2024, indicating a year-over-year improvement of approximately 54% in first half earnings [4][19] - The loan portfolio yield improved to 5.59% in Q2 2025 from 5.52% in Q1 2025, reflecting the benefits of asset repricing [20] - Core deposit balances increased by approximately $195 million in Q2 2025, contributing to a reduction in brokered funding by about $127 million [18][19] Business Line Data and Key Metrics Changes - Loan outstandings decreased slightly to just under $3 billion, attributed to larger payoffs from asset sales and refinancing activities [11][12] - Deposit balances increased by over $67 million during the quarter, with a focus on attracting new depositors [12] Market Data and Key Metrics Changes - The commercial real estate portfolio is improving, with a loan-to-value ratio of 65% and a debt service coverage ratio of 1.35 times [9] - The office property market in Des Moines is facing challenges, with significant vacancy issues affecting the overall market [8] Company Strategy and Development Direction - The company is focused on relationship building and deposit growth, with an emphasis on maintaining strong asset quality [5][9] - There are ongoing efforts to attract high-value retail deposits and business banking opportunities, particularly in the Minnesota market [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the pipeline for loan growth, indicating a robust number of projects and opportunities despite some headwinds from payoffs [22] - The company anticipates margin improvement in the second half of the year due to continued asset repricing [23][24] Other Important Information - The company declared a dividend of $0.25 per share, payable on August 20, 2025, with a current stock yield exceeding 5% [5] Q&A Session Summary Question: Client sentiment and loan growth pipeline outlook - Management noted a robust pipeline with many projects and opportunities to maintain and grow the loan portfolio [22] Question: Margin trajectory in the second half of the year - Management sees potential for margin improvement due to asset repricing, regardless of Fed rate cuts [23][24] Question: Opportunities for hiring and expanding in northern markets - There are opportunities in the marketplace, especially due to M&A activity and larger banks abandoning regional centers [25] Question: Deposit growth opportunities in the second half of the year - The focus remains on growing deposit relationships alongside credit relationships [27] Question: Expense run rate for the second half of the year - The second quarter's expense run rate is expected to be a good indicator for the second half, with no significant items anticipated [28]

Group 1: Earnings Performance - West Bancorp reported quarterly earnings of $0.47 per share, exceeding the Zacks Consensus Estimate of $0.45 per share, and up from $0.31 per share a year ago, representing an earnings surprise of +4.44% [1] - The company posted revenues of $23.83 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.83%, compared to year-ago revenues of $19.58 million [2] - Over the last four quarters, West Bancorp has consistently surpassed consensus EPS estimates [2] Group 2: Stock Performance and Outlook - West Bancorp shares have declined approximately 10.5% since the beginning of the year, while the S&P 500 has gained 8.1% [3] - The current consensus EPS estimate for the upcoming quarter is $0.48 on revenues of $24.1 million, and for the current fiscal year, it is $1.90 on revenues of $95.8 million [7] - The estimate revisions trend for West Bancorp was unfavorable prior to the earnings release, resulting in a Zacks Rank 5 (Strong Sell) for the stock, indicating expected underperformance in the near future [6] Group 3: Industry Context - The Financial - Savings and Loan industry, to which West Bancorp belongs, is currently ranked in the bottom 26% of over 250 Zacks industries, suggesting potential challenges for stocks in this sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment [5]

Core Viewpoint - West Bancorporation, Inc. reported a solid financial performance in the second quarter of 2025, with net income increasing to $8.0 million, reflecting growth compared to both the previous quarter and the same quarter last year [1][2]. Financial Performance - The net income for the second quarter of 2025 was $8.0 million, or $0.47 per diluted common share, compared to $7.8 million, or $0.46 per diluted common share in the first quarter of 2025, and $5.2 million, or $0.31 per diluted common share in the second quarter of 2024 [1][2]. - For the first six months of 2025, net income was $15.8 million, or $0.93 per diluted common share, compared to $11.0 million, or $0.65 per diluted common share for the same period in 2024 [1][2]. Dividends - The Board of Directors declared a regular quarterly dividend of $0.25 per common share, payable on August 20, 2025, to stockholders of record on August 6, 2025 [1]. Key Financial Metrics - Return on average equity for the second quarter of 2025 was 13.65%, up from 9.50% in the second quarter of 2024 [4]. - Return on average assets was 0.80% for the second quarter of 2025, compared to 0.53% in the same quarter of 2024 [4]. - The efficiency ratio improved to 56.45% in the second quarter of 2025 from 67.14% in the second quarter of 2024 [4][12]. Loan and Deposit Trends - Loans decreased by $50.1 million in the second quarter of 2025, primarily due to a decrease in commercial loans and commercial real estate loans [5]. - Deposits increased by $67.5 million, or 2.0%, in the second quarter of 2025, with a notable increase of $194.7 million, or 6.5%, excluding brokered deposits [5][12]. - The total loans as of June 30, 2025, were $2.966 billion, a decrease of $32.4 million, or 1.1%, compared to June 30, 2024 [12]. Credit Quality - The company maintained strong credit quality metrics, with no loans on nonaccrual status and no loans past due greater than 90 days as of June 30, 2025 [2][5]. - The allowance for credit losses to total loans was 1.03% at June 30, 2025, compared to 1.01% at March 31, 2025 [5]. Interest Income and Margin - Net interest income for the second quarter of 2025 was $21.4 million, compared to $20.9 million in the first quarter of 2025, driven by an increase in interest income on deposits with banks [5][18]. - The net interest margin was 2.27% for the second quarter of 2025, compared to 1.86% for the same quarter in 2024 [12][18].

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) West Bancorporation's unaudited consolidated financial statements for Q2 2025 detail its financial position and performance Consolidated Balance Sheets Consolidated Balance Sheet Highlights (as of June 30, 2025 vs. December 31, 2024) | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--- | :--- | :--- | | **Total Assets** | **$4,056,669** | **$4,014,991** | | Loans, net | $2,935,818 | $2,974,428 | | Securities available for sale | $536,709 | $544,565 | | **Total Liabilities** | **$3,815,739** | **$3,787,116** | | Total Deposits | $3,391,993 | $3,357,596 | | **Total Stockholders' Equity** | **$240,930** | **$227,875** | Consolidated Statements of Income Income Statement Summary (Three Months Ended June 30) | Metric (in thousands) | 2025 | 2024 | | :--- | :--- | :--- | | Net Interest Income | $21,419 | $17,230 | | Credit Loss Expense | $0 | $0 | | Noninterest Income | $2,410 | $2,346 | | Noninterest Expense | $13,485 | $13,194 | | **Net Income** | **$7,979** | **$5,192** | Income Statement Summary (Six Months Ended June 30) | Metric (in thousands) | 2025 | 2024 | | :--- | :--- | :--- | | Net Interest Income | $42,274 | $33,980 | | Credit Loss Expense | $0 | $0 | | Noninterest Income | $4,653 | $4,645 | | Noninterest Expense | $26,548 | $25,062 | | **Net Income** | **$15,821** | **$11,001** | Earnings Per Share (EPS) | Period | Diluted EPS 2025 | Diluted EPS 2024 | | :--- | :--- | :--- | | Three Months Ended June 30 | $0.47 | $0.31 | | Six Months Ended June 30 | $0.93 | $0.65 | Consolidated Statements of Comprehensive Income (Loss) - Comprehensive income for the six months ended June 30, 2025 was **$21.3 million**, a significant increase from **$7.1 million** in the same period of 2024, driven by higher net income and positive other comprehensive income from unrealized gains on securities[14](index=14&type=chunk) Consolidated Statements of Stockholders' Equity - Total stockholders' equity increased from **$227.9 million** at year-end 2024 to **$240.9 million** at June 30, 2025, primarily due to net income of **$15.8 million** and other comprehensive income of **$5.5 million**, partially offset by cash dividends of **$8.4 million**[17](index=17&type=chunk) Consolidated Statements of Cash Flows Cash Flow Summary (Six Months Ended June 30) | Activity (in thousands) | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $23,276 | $16,123 | | Net Cash from Investing Activities | $56,126 | $(62,058) | | Net Cash from Financing Activities | $22,321 | $130,397 | | **Net Increase in Cash** | **$101,723** | **$84,462** | Notes to Consolidated Financial Statements - The company's loan portfolio is primarily composed of commercial real estate (**$1.88 billion**), commercial loans (**$501 million**), and construction/land development loans (**$459 million**)[38](index=38&type=chunk) - The Allowance for Credit Losses (ACL) was **$30.5 million** as of June 30, 2025, with no provision for credit loss expense recorded in the first six months of 2025[41](index=41&type=chunk) - The company utilizes interest rate swaps and collars to manage interest rate risk, with derivatives designated as cash flow hedges totaling a notional amount of **$495 million** as of June 30, 2025[79](index=79&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's discussion highlights strong Q2 and H1 2025 performance, driven by increased net interest income and robust credit quality Overview Q2 2025 Performance Highlights vs. Q2 2024 | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Income (in thousands) | $7,979 | $5,192 | | Diluted EPS | $0.47 | $0.31 | | Return on Average Assets (ROA) | 0.80% | 0.53% | | Return on Average Equity (ROE) | 13.65% | 9.50% | - The increase in net interest income for Q2 2025 was primarily due to **higher interest income** on deposits with banks and **lower interest expense** on deposits and borrowings[121](index=121&type=chunk) - Credit quality remained strong, with the ratio of nonperforming loans to total assets at **0.00%** as of June 30, 2025[126](index=126&type=chunk) Results of Operations - Net interest margin on a fully taxable equivalent (FTE) basis increased by **41 basis points** to **2.27%** for Q2 2025 compared to **1.86%** in Q2 2024[141](index=141&type=chunk) - **No credit loss expense** was recorded for loans in the first six months of 2025 or 2024, reflecting stable credit quality[148](index=148&type=chunk) - Noninterest expense for the six months ended June 30, 2025 increased by **$1.5 million** (**5.9%**) compared to the same period in 2024, primarily due to higher salaries, occupancy, and equipment costs related to new buildings[157](index=157&type=chunk)[158](index=158&type=chunk) - The effective tax rate increased to **22.4%** for the first six months of 2025 from **18.9%** in the prior year, mainly due to the expiration of a new market tax credit at the end of 2024[160](index=160&type=chunk) Financial Condition - Total assets grew to **$4.06 billion** at June 30, 2025, from **$4.01 billion** at year-end 2024[162](index=162&type=chunk) - Loans outstanding decreased by **$38.5 million** (**1.3%**) during the first six months of 2025, primarily due to declines in construction and commercial loans[126](index=126&type=chunk)[166](index=166&type=chunk) - Deposits increased by **$34.4 million** (**1.0%**) in the first half of 2025, with core deposits growing by **$92.5 million** (excluding brokered deposits), aided by a large municipal deposit of **$243 million**[170](index=170&type=chunk) - The company and West Bank met all capital adequacy requirements as of June 30, 2025, with a consolidated Tier 1 Capital Ratio of **9.89%**[179](index=179&type=chunk)[181](index=181&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=53&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages interest rate risk using an earnings simulation model, showing sensitivity to rate changes Net Interest Income Sensitivity Analysis (at June 30, 2025) | Change in Interest Rates | % Change in NII (1-Year Horizon) | | :--- | :--- | | +300 bps | (7.68)% | | +200 bps | (5.03)% | | +100 bps | (2.46)% | | -100 bps | +2.24% | | -200 bps | +3.64% | | -300 bps | +4.36% | [Item 4. Controls and Procedures](index=54&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** as of June 30, 2025[187](index=187&type=chunk) - There were **no changes** in internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal controls[188](index=188&type=chunk) [PART II. OTHER INFORMATION](index=54&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=54&type=section&id=Item%201.%20Legal%20Proceedings) The company is not involved in any material pending legal proceedings beyond routine litigation - The company reports **no material pending legal proceedings** outside of ordinary routine litigation[190](index=190&type=chunk) [Item 1A. Risk Factors](index=54&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors have been reported since the last Form 10-K filing - **No material changes** to risk factors were reported since the last Form 10-K filing[191](index=191&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=54&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities or related use of proceeds - The company reported **no unregistered sales** of equity securities[192](index=192&type=chunk) [Item 6. Exhibits](index=54&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the report, including CEO/CFO certifications and XBRL data files - Exhibits filed with the report include **Sarbanes-Oxley Act certifications** (31.1, 31.2, 32.1, 32.2) and **XBRL data files**[196](index=196&type=chunk)

[Executive Summary and Key Financial Highlights](index=1&type=section&id=Executive%20Summary%20and%20Key%20Financial%20Highlights) West Bancorporation, Inc. reported strong Q2 2025 and year-to-date performance with increased net income, diluted EPS, and improved efficiency, while maintaining excellent credit quality [Q2 2025 and Year-to-Date Performance](index=1&type=section&id=Q2%202025%20and%20Year-to-Date%20Performance) West Bancorporation, Inc. reported a solid second quarter 2025 with increased net income and diluted EPS compared to both the previous quarter and the same quarter last year. The company also declared a regular quarterly dividend of $0.25 per common share | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :-------------------------------- | :------ | :------ | :------ | | Net income (in thousands) | $7,979 | $7,842 | $5,192 | | Diluted common share | $0.47 | $0.46 | $0.31 | | Metric | First Six Months 2025 | First Six Months 2024 | | :-------------------------------- | :-------------------- | :-------------------- | | Net income (in thousands) | $15,800 | $11,000 | | Diluted common share | $0.93 | $0.65 | - The Board of Directors declared a regular quarterly dividend of **$0.25 per common share**, payable on August 20, 2025, to stockholders of record on August 6, 2025[1](index=1&type=chunk) [CEO Commentary on Performance and Credit Quality](index=1&type=section&id=CEO%20Commentary%20on%20Performance%20and%20Credit%20Quality) CEO David Nelson highlighted significant improvements in year-to-date net interest income, net interest margin, and efficiency ratio compared to the first six months of 2024. He emphasized the company's strong credit quality with no nonaccrual or past due loans and ongoing efforts to grow its core customer base - Significant improvements in year-to-date **net interest income**, **net interest margin**, and **efficiency ratio** compared to the first six months of 2024[2](index=2&type=chunk) - The company is well positioned for continued earnings improvement through asset repricing, controlled funding costs, and maintaining pristine credit quality[2](index=2&type=chunk) - Credit quality metrics remain strong with **no loans on nonaccrual status** and **no loans past due greater than 90 days** at June 30, 2025[2](index=2&type=chunk) [Selected Quarterly Financial Highlights](index=1&type=section&id=Selected%20Quarterly%20Financial%20Highlights) Key financial metrics for Q2 2025 show strong performance with a return on average equity of 13.65% and a significantly improved efficiency ratio of 56.45% compared to Q2 2024 | Metric | Quarter Ended June 30, 2025 | Quarter Ended March 31, 2025 | Quarter Ended June 30, 2024 | | :------------------------------ | :-------------------------- | :--------------------------- | :-------------------------- | | Net income (in thousands) | $7,979 | $7,842 | $5,192 | | Return on average equity | 13.65 % | 13.84 % | 9.50 % | | Return on average assets | 0.80 % | 0.81 % | 0.53 % | | Efficiency ratio (non-GAAP) | 56.45 % | 56.37 % | 67.14 % | | Nonperforming assets to total assets | 0.00 % | 0.00 % | 0.01 % | [Comparative Financial Analysis](index=1&type=section&id=Comparative%20Financial%20Analysis) The company's Q2 2025 performance showed a decrease in loans but a significant increase in deposits, leading to improved net interest income and efficiency compared to prior periods [Second Quarter 2025 vs. First Quarter 2025](index=1&type=section&id=Second%20Quarter%202025%20vs.%20First%20Quarter%202025) Comparing Q2 2025 to Q1 2025, the company experienced a decrease in loans primarily due to commercial and commercial real estate payoffs, while deposits saw a significant increase, particularly non-brokered deposits. Net interest income improved, though net interest margin slightly declined, and the efficiency ratio remained stable - Loans decreased by **$50.1 million** in Q2 2025, mainly due to decreases in commercial and commercial real estate loans, partially offset by an increase in construction loans. This was driven by customer payoffs and reduced line of credit utilization[4](index=4&type=chunk) - No credit loss expense on loans was recorded in either Q2 2025 or Q1 2025[4](index=4&type=chunk) | Metric | Q2 2025 | Q1 2025 | Change (QoQ) | | :-------------------------------- | :------ | :------ | :----------- | | Allowance for credit losses to total loans | 1.03 % | 1.01 % | +0.02 pp | | Nonaccrual loans | $0 | $181K | -$181K | | Deposits (in thousands) | $3,391,993 | $3,324,518 | +$67,475 (+2.0%) | | Brokered deposits (in thousands) | $208,300 | $335,500 | -$127,200 | | Non-brokered deposits (in thousands) | $3,183,693 | $2,989,018 | +$194,675 (+6.5%) | | Net interest margin (FTE) | 2.27 % | 2.28 % | -0.01 pp | | Net interest income (in thousands) | $21,400 | $20,900 | +$500 | | Efficiency ratio (non-GAAP) | 56.45 % | 56.37 % | +0.08 pp | | Tangible common equity ratio | 5.94 % | 5.97 % | -0.03 pp | [Second Quarter 2025 vs. Second Quarter 2024](index=3&type=section&id=Second%20Quarter%202025%20vs.%20Second%20Quarter%202024) Comparing Q2 2025 to Q2 2024, the company demonstrated significant improvements in net interest margin and efficiency ratio, driven by decreased interest expense on deposits and borrowed funds. Deposits increased substantially, allowing for a reduction in higher-cost borrowed funds, while loans experienced a slight decrease - Loans decreased by **$32.4 million (1.1%)** at June 30, 2025, compared to June 30, 2024, primarily due to decreases in commercial and construction loans, partially offset by an increase in commercial real estate loans[6](index=6&type=chunk) - Deposits increased by **$211.1 million (6.6%)** at June 30, 2025, compared to June 30, 2024. Excluding brokered deposits, deposits increased by **$373.1 million (13.3%)**[6](index=6&type=chunk) | Metric | Q2 2025 | Q2 2024 | Change (YoY) | | :-------------------------------- | :------ | :------ | :----------- | | Borrowed funds (in thousands) | $390,300 | $525,500 | -$135,200 | | Net interest margin (FTE) | 2.27 % | 1.86 % | +0.41 pp | | Net interest income (in thousands) | $21,400 | $17,200 | +$4,200 | | Efficiency ratio (non-GAAP) | 56.45 % | 67.14 % | -10.69 pp | | Tangible common equity ratio | 5.94 % | 5.65 % | +0.29 pp | [Detailed Financial Statements](index=5&type=section&id=Detailed%20Financial%20Statements) This section presents condensed balance sheets, detailed breakdowns of loans, deposits, borrowings, and stockholders' equity, along with consolidated statements of income for quarterly and year-to-date periods [Condensed Balance Sheets](index=5&type=section&id=Condensed%20Balance%20Sheets) The condensed balance sheets provide a snapshot of the company's financial position, showing total assets increased to $4.057 billion at June 30, 2025, from $3.965 billion at June 30, 2024, primarily driven by an increase in deposits | Metric (in thousands) | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :-------------------- | :------------ | :------------- | :---------------- | :----------------- | :------------ | | Total assets | $4,056,669 | $3,986,669 | $4,014,991 | $3,988,566 | $3,965,115 | | Loans, net | $2,935,818 | $2,985,945 | $2,974,428 | $2,991,802 | $2,970,352 | | Deposits | $3,391,993 | $3,324,518 | $3,357,596 | $3,278,553 | $3,180,922 | | Stockholders' equity | $240,930 | $237,873 | $227,875 | $235,353 | $223,883 | [Loans and Credit Quality](index=6&type=section&id=Loans%20and%20Credit%20Quality) Loan balances decreased slightly quarter-over-quarter and year-over-year, with commercial loans seeing the most significant reduction. The company maintained excellent credit quality, with no substandard or doubtful loans at June 30, 2025, and a healthy allowance for credit losses | Loan Category (in thousands) | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--------------------------- | :------------ | :------------- | :------------ | | Commercial | $500,854 | $531,267 | $526,589 | | Construction, land and land development | $459,037 | $451,230 | $496,864 | | Commercial Real Estate | $1,875,857 | $1,909,330 | $1,856,301 | | Total loans | $2,966,357 | $3,016,471 | $2,998,774 | | Allowance for credit losses | $(30,539) | $(30,526) | $(28,422) | - Credit quality remained strong with **no substandard or doubtful loans** at June 30, 2025. 'Pass' category loans constituted the vast majority at **$2,958,318 thousand**[12](index=12&type=chunk) [Deposits](index=6&type=section&id=Deposits) Total deposits increased significantly year-over-year and quarter-over-quarter, reaching $3.392 billion at June 30, 2025. This growth was primarily driven by non-brokered deposits, including a large municipal deposit, while brokered deposits decreased | Deposit Category (in thousands) | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :------------------------------ | :------------ | :------------- | :------------ | | Noninterest-bearing demand | $521,990 | $519,771 | $530,441 | | Interest-bearing demand | $461,207 | $517,409 | $443,658 | | Savings and money market - non-brokered | $1,749,049 | $1,490,189 | $1,483,264 | | Money market - brokered | $98,877 | $143,423 | $97,259 | | Time - non-brokered | $451,463 | $461,655 | $353,269 | | Time - brokered | $109,407 | $192,071 | $273,031 | | Total deposits | $3,391,993 | $3,324,518 | $3,180,922 | - A local municipal customer deposited approximately **$243.0 million** of bond proceeds in Q2 2025, expected to be withdrawn over 24 months[6](index=6&type=chunk) - Estimated uninsured deposits accounted for approximately **27.2%** of total deposits at June 30, 2025[6](index=6&type=chunk) [Borrowings](index=6&type=section&id=Borrowings) Total borrowings significantly decreased year-over-year, primarily due to reductions in federal funds purchased and Federal Home Loan Bank advances, reflecting the increased deposit base | Borrowing Category (in thousands) | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------- | :------------ | | Federal funds purchased and other short-term borrowings | $0 | $0 | $85,500 | | Subordinated notes, net | $80,024 | $79,959 | $79,762 | | Federal Home Loan Bank advances | $270,000 | $270,000 | $315,000 | | Long-term debt | $40,236 | $41,486 | $45,236 | | Total borrowings | $390,260 | $391,445 | $525,498 | - The decrease in borrowed funds balances resulted primarily from the increase in deposits since June 30, 2024[6](index=6&type=chunk) [Stockholders' Equity](index=6&type=section&id=Stockholders'%20Equity) Stockholders' equity increased to $240.9 million at June 30, 2025, from $223.9 million at June 30, 2024, driven by retained net income and a decrease in accumulated other comprehensive loss | Equity Component (in thousands) | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :------------------------------ | :------------ | :------------- | :------------ | | Common stock | $3,000 | $3,000 | $3,000 | | Additional paid-in capital | $35,773 | $35,072 | $34,322 | | Retained earnings | $285,990 | $282,247 | $273,981 | | Accumulated other comprehensive loss | $(83,833) | $(82,446) | $(87,420) | | Total stockholders' equity | $240,930 | $237,873 | $223,883 | - The increase in stockholders' equity was due to retained net income and the decrease in accumulated other comprehensive loss[6](index=6&type=chunk) [Consolidated Statements of Income (Quarterly)](index=7&type=section&id=Consolidated%20Statements%20of%20Income%20(Quarterly)) The consolidated statements of income for Q2 2025 show an increase in net interest income to $21.4 million, contributing to a net income of $8.0 million. Interest income from deposits with banks significantly increased quarter-over-quarter | Metric (in thousands) | Q2 2025 | Q1 2025 | Q2 2024 | | :-------------------- | :------ | :------ | :------ | | Total interest income | $47,962 | $46,136 | $47,568 | | Total interest expense | $26,543 | $25,281 | $30,338 | | Net interest income | $21,419 | $20,855 | $17,230 | | Credit loss expense | $0 | $0 | $0 | | Total noninterest income | $2,410 | $2,243 | $2,346 | | Total noninterest expense | $13,485 | $13,063 | $13,194 | | Income before income taxes | $10,344 | $10,035 | $6,382 | | Net income | $7,979 | $7,842 | $5,192 | | Diluted EPS | $0.47 | $0.46 | $0.31 | - Interest income from deposits with banks increased significantly from **$1,617 thousand** in Q1 2025 to **$2,847 thousand** in Q2 2025[13](index=13&type=chunk) [Consolidated Statements of Income (Six Months Ended)](index=8&type=section&id=Consolidated%20Statements%20of%20Income%20(Six%20Months%20Ended)) For the first six months of 2025, net income increased to $15.8 million from $11.0 million in the prior year period, driven by a substantial increase in net interest income and a decrease in total interest expense | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :----------------------------- | :----------------------------- | | Total interest income | $94,098 | $92,138 | | Total interest expense | $51,824 | $58,158 | | Net interest income | $42,274 | $33,980 | | Credit loss expense | $0 | $0 | | Total noninterest income | $4,653 | $4,645 | | Total noninterest expense | $26,548 | $25,062 | | Income before income taxes | $20,379 | $13,563 | | Net income | $15,821 | $11,001 | | Diluted EPS | $0.93 | $0.65 | - Net interest income for the first six months of 2025 increased by **$8.294 million** compared to the same period in 2024, primarily due to a decrease in interest expense[14](index=14&type=chunk) [Key Financial Ratios and Shareholder Data](index=9&type=section&id=Key%20Financial%20Ratios%20and%20Shareholder%20Data) This section highlights the company's strong capital position, improved profitability, and efficiency through key performance and regulatory capital ratios, alongside common share data [Common Share Data](index=9&type=section&id=Common%20Share%20Data) Common share data reflects consistent quarterly dividends and an increase in book value per common share. The market price to book value ratio remained strong, indicating positive investor sentiment | Metric | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :-------------------------- | :------------ | :------------- | :---------------- | :----------------- | :------------ | | Earnings per common share (diluted) | $0.47 | $0.46 | $0.42 | $0.35 | $0.31 | | Dividends per common share | $0.25 | $0.25 | $0.25 | $0.25 | $0.25 | | Book value per common share | $14.22 | $14.06 | $13.54 | $13.98 | $13.30 | | Closing stock price | $19.63 | $19.94 | $21.65 | $19.01 | $17.90 | | Market price/book value | 138.05 % | 141.82 % | 159.90 % | 135.98 % | 134.59 % | | Annualized dividend yield | 5.09 % | 5.02 % | 4.62 % | 5.26 % | 5.59 % | [Regulatory Capital Ratios](index=9&type=section&id=Regulatory%20Capital%20Ratios) Both the Company and West Bank maintained strong regulatory capital ratios, with all ratios exceeding minimum requirements and showing an upward trend, indicating a robust capital position | Ratio | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :-------------------------- | :------------ | :------------- | :---------------- | :----------------- | :------------ | | **Consolidated:** | | | | | | | Total risk-based capital ratio | 12.53 % | 12.18 % | 12.11 % | 11.95 % | 11.85 % | | Tier 1 risk-based capital ratio | 9.89 % | 9.59 % | 9.51 % | 9.39 % | 9.30 % | | Tier 1 leverage capital ratio | 8.33 % | 8.36 % | 7.93 % | 8.15 % | 8.08 % | | Common equity tier 1 ratio | 9.32 % | 9.02 % | 8.95 % | 8.83 % | 8.74 % | | **West Bank:** | | | | | | | Total risk-based capital ratio | 13.21 % | 12.90 % | 12.86 % | 12.73 % | 12.66 % | | Tier 1 risk-based capital ratio | 12.29 % | 11.99 % | 11.96 % | 11.86 % | 11.79 % | | Tier 1 leverage capital ratio | 10.36 % | 10.46 % | 9.97 % | 10.29 % | 10.25 % | | Common equity tier 1 ratio | 12.29 % | 11.99 % | 11.96 % | 11.86 % | 11.79 % | [Key Performance Ratios](index=9&type=section&id=Key%20Performance%20Ratios) Key performance ratios demonstrate improved profitability and efficiency. Return on average assets and equity increased year-over-year, and the net interest margin expanded significantly. The efficiency ratio showed substantial improvement, indicating better cost management | Metric | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------- | :------ | :------ | :------ | :------ | :------ | :------- | :------- | | Return on average assets | 0.80 % | 0.81 % | 0.68 % | 0.60 % | 0.53 % | 0.80 % | 0.57 % | | Return on average equity | 13.65 % | 13.84 % | 12.24 % | 10.41 % | 9.50 % | 13.74 % | 10.07 % | | Net interest margin (FTE) | 2.27 % | 2.28 % | 1.98 % | 1.91 % | 1.86 % | 2.27 % | 1.87 % | | Yield on interest-earning assets | 5.07 % | 5.04 % | 5.02 % | 5.16 % | 5.13 % | 5.06 % | 5.06 % | | Cost of interest-bearing liabilities | 3.28 % | 3.25 % | 3.57 % | 3.84 % | 3.83 % | 3.27 % | 3.77 % | | Efficiency ratio (non-GAAP) | 56.45 % | 56.37 % | 60.79 % | 63.28 % | 67.14 % | 56.41 % | 64.62 % | | Nonperforming assets to total assets | 0.00 % | 0.00 % | 0.00 % | 0.01 % | 0.01 % | | | | ACL ratio | 1.03 % | 1.01 % | 1.01 % | 0.97 % | 0.95 % | | | | Tangible common equity ratio | 5.94 % | 5.97 % | 5.68 % | 5.90 % | 5.65 % | | | [Non-GAAP Financial Measures](index=10&type=section&id=Non-GAAP%20Financial%20Measures) This section provides reconciliations for non-GAAP financial measures, including net interest income and efficiency ratio on a fully tax-equivalent basis, to aid in financial performance analysis [Reconciliation of Net Interest Income and Net Interest Margin (FTE)](index=10&type=section&id=Reconciliation%20of%20Net%20Interest%20Income%20and%20Net%20Interest%20Margin%20(FTE)) The company provides non-GAAP reconciliations for net interest income and net interest margin on a fully tax-equivalent (FTE) basis, which management believes offers useful information for evaluating financial performance and comparability within the banking industry - Non-GAAP financial measures, such as FTE net interest income and net interest margin, are used to provide useful information for analyzing and evaluating financial performance and enhancing comparability of income from taxable and nontaxable sources[21](index=21&type=chunk) | Metric (in thousands) | Q2 2025 | Q1 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------- | :------ | :------ | :------ | :------- | :------- | | Net interest income (GAAP) | $21,419 | $20,855 | $17,230 | $42,274 | $33,980 | | Tax-equivalent adjustment | $59 | $66 | $55 | $125 | $137 | | Net interest income on a FTE basis (non-GAAP) | $21,478 | $20,921 | $17,285 | $42,399 | $34,117 | | Net interest margin on a FTE basis (non-GAAP) | 2.27 % | 2.28 % | 1.86 % | 2.27 % | 1.87 % | [Reconciliation of Efficiency Ratio (Adjusted and FTE)](index=10&type=section&id=Reconciliation%20of%20Efficiency%20Ratio%20(Adjusted%20and%20FTE)) The efficiency ratio, presented on an adjusted and FTE basis, is a non-GAAP measure that management uses to assess the company's financial performance and cost management, with a lower ratio being more desirable - The efficiency ratio expresses noninterest expense as a percentage of fully taxable equivalent net interest income and noninterest income, excluding specific noninterest income and expenses. A lower ratio is more desirable[23](index=23&type=chunk) | Metric (in thousands) | Q2 2025 | Q1 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------- | :------ | :------ | :------ | :------- | :------- | | Net interest income on a FTE basis (non-GAAP) | $21,478 | $20,921 | $17,285 | $42,399 | $34,117 | | Noninterest income | $2,410 | $2,243 | $2,346 | $4,653 | $4,645 | | Adjusted income | $23,888 | $23,172 | $19,652 | $47,060 | $38,783 | | Noninterest expense | $13,485 | $13,063 | $13,194 | $26,548 | $25,062 | | Efficiency ratio on an adjusted and FTE basis (non-GAAP) | 56.45 % | 56.37 % | 67.14 % | 56.41 % | 64.62 % | [Company Information and Disclosures](index=4&type=section&id=Company%20Information%20and%20Disclosures) This section provides an overview of West Bancorporation, Inc., details on forward-looking statements and associated risks, and information regarding additional financial disclosures and conference call access [About West Bancorporation, Inc.](index=4&type=section&id=About%20West%20Bancorporation,%20Inc.) West Bancorporation, Inc., headquartered in West Des Moines, Iowa, operates West Bank, a community bank providing lending, deposit, and trust services to businesses and consumers across multiple locations in Iowa and Minnesota - West Bancorporation, Inc. (Nasdaq: WTBA) is headquartered in West Des Moines, Iowa, and has served customers since 1893[9](index=9&type=chunk) - West Bank, a wholly-owned subsidiary, is a community bank focusing on lending, deposit services, and trust services for small- to medium-sized businesses and consumers[9](index=9&type=chunk) - The bank operates six offices in the Des Moines metropolitan area, one in Coralville, Iowa, and four in Minnesota (Rochester, Owatonna, Mankato, and St. Cloud)[9](index=9&type=chunk) [Forward-Looking Statements and Risk Factors](index=4&type=section&id=Forward-Looking%20Statements%20and%20Risk%20Factors) The report contains forward-looking statements regarding future business plans and operating results, which are subject to various risks and uncertainties. These risks include interest rate fluctuations, competitive pressures, technological changes, credit risks, and regulatory changes, among others - The report includes 'forward-looking statements' concerning business plans, objectives, and expected operating results, identified by words like 'believes,' 'expects,' 'intends,' and 'anticipates'[10](index=10&type=chunk) - Actual results could differ materially from forward-looking statements due to underlying assumptions being incorrect or not materializing as expected[10](index=10&type=chunk) - Key risks and uncertainties include interest rate risk, competitive pressures, technological changes (including AI), liquidity risk, credit risks, concentration of large deposits, economic conditions, bank failures, regulatory changes, cybersecurity incidents, and geopolitical events[10](index=10&type=chunk) [Additional Information and Conference Call Details](index=4&type=section&id=Additional%20Information%20and%20Conference%20Call%20Details) Further detailed financial results are available in the company's Form 10-Q filing. A conference call was scheduled for July 24, 2025, to discuss the results, with replay options available - The Company filed its report on Form 10-Q with the SEC, available on West Bank's Investor Relations website[7](index=7&type=chunk) - A conference call to discuss results was scheduled for 2:00 p.m. Central Time on Thursday, July 24, 2025, with replay available until August 7, 2025[8](index=8&type=chunk)

Group 1 - The stock of West Bancorporation, Inc. (WTBA) is experiencing significant attention due to high implied volatility in the options market, particularly for the Jul 18, 2025 $35.00 Call option [1] - Implied volatility indicates the market's expectation of future price movement, suggesting that investors anticipate a significant change in West Bancorporation's stock price, potentially due to an upcoming event [2] - West Bancorporation currently holds a Zacks Rank 5 (Strong Sell) in the Financial - Savings and Loan Industry, which is in the top 12% of the Zacks Industry Rank, indicating a generally negative outlook [3] Group 2 - Over the past 60 days, one analyst has raised the earnings estimate for West Bancorporation for the current quarter from 39 cents per share to 46 cents, with no downward revisions from other analysts [3] - The high implied volatility may present a trading opportunity, as options traders often seek to sell premium on options with such volatility, aiming for the underlying stock to not move as much as expected by expiration [4]

Core Viewpoint - West Bancorp (WTBA) is positioned as a strong investment opportunity due to significant upward revisions in earnings estimates, indicating a positive earnings outlook and potential for continued stock price appreciation [1][2]. Earnings Estimate Revisions - Analysts are increasingly optimistic about West Bancorp's earnings prospects, leading to higher estimates that are expected to positively influence the stock price [2]. - The current quarter's earnings estimate is projected at $0.46 per share, reflecting a 48.39% increase from the previous year, with a 17.95% rise in the Zacks Consensus Estimate over the last 30 days [5]. - For the full year, the earnings estimate stands at $1.90 per share, representing a 33.8% increase from the prior year, with a similar positive trend in estimate revisions noted [6]. Zacks Rank and Performance - West Bancorp currently holds a Zacks Rank 1 (Strong Buy), indicating strong agreement among analysts on the upward revisions of earnings estimates, which historically correlates with stock outperformance [3][7]. - Stocks with a Zacks Rank 1 and 2 have shown significant outperformance compared to the S&P 500, with Zacks 1 stocks averaging a 25% annual return since 2008 [3][7]. Recent Stock Performance - Over the past four weeks, West Bancorp shares have increased by 6.3%, suggesting investor confidence in the company's earnings growth potential driven by favorable estimate revisions [8].

Financial Data and Key Metrics Changes - The first quarter earnings were 35% higher than the first quarter of the previous year, with net income reported at $7.8 million compared to $5.8 million in Q1 2024 [6][22]. - Net interest margin increased by 30 basis points compared to the fourth quarter of 2024, with five consecutive quarters of increases in net interest income [24]. - The cost of deposits decreased by 38 basis points this quarter compared to Q4 2024 [24]. Business Line Data and Key Metrics Changes - The loan portfolio was relatively flat at just over $3 billion, with approximately $100 million in payoffs from asset sales and refinance activity [14]. - The refinance activity replaced lower-yielding assets with new quality assets, split evenly between C&I business and commercial real estate transactions [15]. - There was no credit loss expense recorded in the first quarter, indicating strong credit quality [23]. Market Data and Key Metrics Changes - Deposit gathering efforts continue to be emphasized, although deposits decreased slightly due to ordinary cash flow fluctuations rather than loss of relationships [16]. - The Minnesota banks reported cautious customer behavior due to economic uncertainty, but there was success in attracting high-value retail deposits [18][20]. Company Strategy and Development Direction - The company focuses on building comprehensive banking relationships rather than just lending, emphasizing the importance of service and relationship management [44]. - The strategy includes targeting C&I prospects with significant deposit balances and high-value retail deposits [20]. - The company aims to maintain strong credit quality through conservative underwriting practices and a commitment to customer relationships [12]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the loan pipeline, indicating that opportunities exceed planned payoffs [34]. - Concerns were raised about economic uncertainty, tariffs, and potential supply chain issues affecting customers [11][40]. - The company remains committed to its conservative philosophy and expects its credit portfolio to remain strong despite economic challenges [12]. Other Important Information - A dividend of $0.25 per share was declared, payable on May 21 to shareholders of record as of May 7 [7]. - There were no significant one-time items in noninterest income or expense this quarter, and occupancy expenses reflect new building costs [26]. Q&A Session Summary Question: Is there more room to bring deposit costs down? - Management indicated that deposit costs are likely to remain static until market conditions change [29]. Question: What rates were new loans added at compared to those rolling off? - New loans were added at rates starting with six or seven, compared to previous loans starting with three or four [32]. Question: Will growth accelerate in the second quarter? - Management noted that while there are planned payoffs, they expect opportunities to exceed these payoffs [34]. Question: What is the outlook on expenses for the second quarter? - Management expects the first quarter performance to be indicative of future performance, with no significant items anticipated [36]. Question: What is the impact of tariffs on credit metrics? - Concerns were raised about potential cost increases and supply chain issues due to tariffs, but the customer base is considered seasoned and capable of weathering such challenges [40]. Question: How does the company retain core deposits despite low rates? - The company utilizes relationship-based pricing strategies for its commercial deposit base, allowing for negotiation on rates [50].

Financial Data and Key Metrics Changes - The first quarter earnings increased by 35% compared to the first quarter of the previous year [6] - Net income for Q1 2025 was $7.8 million, up from $5.8 million in Q1 2024 and $7.1 million in Q4 2024 [21][22] - Net interest margin improved by 30 basis points compared to Q4 2024, with a cost of deposits decreasing by 38 basis points [22] Business Line Data and Key Metrics Changes - The loan portfolio remained relatively flat at just over $3 billion, with approximately $100 million in payoffs from asset sales and refinance activity [13][14] - The commercial real estate portfolio is performing well, although there are concerns regarding office property vacancies [10][11] Market Data and Key Metrics Changes - Deposit levels decreased slightly due to ordinary cash flow fluctuations, not due to loss of relationships [14] - Retail deposit growth was significant in Minnesota, with a focus on high-value retail deposits from business owners and executives [18] Company Strategy and Development Direction - The company emphasizes building comprehensive banking relationships rather than just lending, focusing on providing a range of services [41][42] - There is a commitment to maintaining strong credit quality and conservative underwriting practices despite economic uncertainties [12] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about economic uncertainty affecting customer profitability and potential supply chain issues due to tariffs [11][36] - The company remains confident in its ability to create and maintain positive relationships with customers in a competitive market [15] Other Important Information - A dividend of 25% per share was declared, payable on May 21 to shareholders of record as of May 7 [7] - The company has completed all building construction projects, which are designed to enhance client engagement [19] Q&A Session Summary Question: Is there more challenge in bringing down deposit costs without rate cuts? - Management indicated that deposit costs have likely been optimized for the current environment and may remain static until market changes occur [25] Question: What rates were new loans added at compared to those rolling off? - New loans replacing older ones were added at higher rates, with a significant portion starting with a six or seven [26][27] Question: Will growth accelerate in the second quarter? - Management noted that while there are planned payoffs, the opportunities for new loans are expected to exceed the payoffs [29] Question: How are expenses expected to trend moving forward? - Management expects first quarter performance to be indicative of future quarters, with no significant items anticipated [31] Question: What concerns exist regarding tariffs or immigration policy? - Management highlighted concerns about tariffs affecting manufacturers, but noted that their seasoned customers typically have strong balance sheets to weather such issues [36] Question: What does the "lift out strategy" refer to? - The strategy refers to successfully recruiting key personnel from other financial institutions to enhance the company's capabilities [44] Question: How does the company retain core deposits despite low rates? - The company negotiates rates based on relationships rather than advertising retail specials, allowing for flexibility in deposit pricing [46]

Core Viewpoint - West Bancorp reported quarterly earnings of $0.46 per share, exceeding the Zacks Consensus Estimate of $0.38 per share, and showing an increase from $0.35 per share a year ago, indicating a strong performance in the financial sector [1][2]. Financial Performance - The company achieved revenues of $23.1 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 6.89%, compared to $19.05 million in the same quarter last year [2]. - Over the last four quarters, West Bancorp has exceeded consensus EPS estimates three times and topped revenue estimates four times [2]. Stock Performance - West Bancorp shares have declined approximately 9.2% since the beginning of the year, while the S&P 500 has decreased by 8.6% [3]. - The stock currently holds a Zacks Rank 3 (Hold), suggesting it is expected to perform in line with the market in the near future [6]. Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.39 on revenues of $22.29 million, and for the current fiscal year, it is $1.65 on revenues of $90.17 million [7]. - The trend of estimate revisions for West Bancorp is mixed, which may change following the recent earnings report [6]. Industry Context - The Financial - Savings and Loan industry, to which West Bancorp belongs, is currently ranked in the top 28% of over 250 Zacks industries, indicating a favorable outlook compared to lower-ranked industries [8].