Core Viewpoint - West Bancorp (WTBA) shows a significantly improving earnings outlook, making it a solid investment choice as analysts continue to raise earnings estimates for the company [1][3]. Earnings Estimate Revisions - The trend in estimate revisions reflects growing analyst optimism regarding West Bancorp's earnings prospects, which is expected to positively influence its stock price [2]. - The Zacks Consensus Estimate for the current quarter has increased to $0.57 per share, representing a 35.7% change from the previous year [5]. - For the full year, the earnings estimate has risen to $2.04 per share, indicating a 43.7% increase from the prior year [6]. Zacks Rank and Performance - West Bancorp has achieved a Zacks Rank 1 (Strong Buy), indicating strong potential for outperformance based on favorable estimate revisions [7]. - Historically, Zacks 1 Ranked stocks have generated an average annual return of +25% since 2008, suggesting a strong track record of performance [3][7]. Recent Stock Performance - Over the past four weeks, West Bancorp shares have increased by 6.4%, indicating investor confidence in the company's earnings growth prospects [8].

Core Viewpoint - West Bancorp (WTBA) has been upgraded to a Zacks Rank 1 (Strong Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][2]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in a company's earnings picture, which is crucial for predicting near-term stock price movements [2][3]. - A strong correlation exists between earnings estimate revisions and stock price movements, with institutional investors using these estimates to determine fair value [3]. Company Performance and Outlook - The recent upgrade indicates an improvement in West Bancorp's underlying business, suggesting that investors may respond positively by driving the stock price higher [4]. - For the fiscal year ending December 2025, West Bancorp is expected to earn $2.04 per share, with a 7.4% increase in the Zacks Consensus Estimate over the past three months [7]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [6]. - The upgrade places West Bancorp in the top 5% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [9].

Financial Data and Key Metrics Changes - West Bancorporation Inc. reported a 16% earnings increase over the prior quarter and a 55% increase compared to the third quarter of the previous year [4] - Net income for the third quarter was $9.3 million, up from $8 million in the second quarter and $6 million in the same quarter last year [12] - The net interest margin improved by nine basis points compared to the previous quarter [12] - Loan yield increased to 5.66% from 5.59% in the second quarter and 5.52% in the first quarter of the year [12] Business Line Data and Key Metrics Changes - Loan outstandings were slightly up at just over $3 billion, with a few larger payoffs from asset sales and refinance activity [8] - Core deposit balances decreased by approximately $82 million in the third quarter, primarily due to normal cash flow fluctuations in core public fund deposits [12] Market Data and Key Metrics Changes - The Minnesota banking segment is experiencing a slowdown among manufacturing clients due to economic uncertainty, but there are new business opportunities arising from M&A activity in the market [9][10] - The company is focusing on deposit-rich business banking opportunities and has successfully attracted new deposits from high-earning individuals [10] Company Strategy and Development Direction - The company is committed to maintaining strong credit quality and has a disciplined approach to loan opportunities, focusing on quality over quantity [6][8] - West Bancorporation aims to leverage its facilities for client engagement and relationship building, which is a key part of its growth strategy [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining a strong credit quality and expects the margin to benefit from future Fed rate cuts and loan renewal repricing [4][6] - The company anticipates continued loan yield improvement due to fixed-rate assets repricing into higher yields [12] Other Important Information - A quarterly dividend of $0.25 per share was declared, payable on November 19, 2025 [5] Q&A Session Summary Question: Update on loan growth pipeline and market share in Minnesota - The pipeline is good but not as robust as in the past due to a more selective approach to credit [18][19] Question: Can mid-single digit growth be funded through deposit gathering? - The objective is to manage cash flows from the investment portfolio and deposit gathering, with some potential need for short-term wholesale funding [22] Question: Update on margin tailwinds and deposit beta assumptions - There are still repricing opportunities in the loan portfolio, but deposit betas may not be as aggressive as in the past due to competitive pressures [23][25] Question: Thoughts on future tax rate - The forward tax rate is expected to be similar to the first half of the year, with the third quarter being an anomaly [27] Question: Capital management and deployment priorities - There are no specific plans, but the focus is on good loan opportunities and organic growth [29] Question: Impact of agricultural distress on the company - The company is somewhat insulated from direct agricultural impacts, as most customers are not specific ag manufacturers [33] Question: Assessment of Minnesota growth venture - The Minnesota growth venture has exceeded expectations and contributes significantly to the company's bottom line [35]

Financial Data and Key Metrics Changes - West Bancorporation reported a 16% earnings increase over the prior quarter and a 55% increase compared to the third quarter of the previous year [4] - Net income for the third quarter was $9.3 million, up from $8 million in the second quarter and $6 million in the same quarter last year [12] - The net interest margin improved by nine basis points compared to the previous quarter [12] - Loan yield increased to 5.66% from 5.59% in the second quarter and 5.52% in the first quarter of the year [12] - The effective tax rate for the quarter was around 19%, lower than the 22% to 23% range in the first two quarters of the year [12] Business Line Data and Key Metrics Changes - Loan outstandings were slightly up at just over $3 billion, with a $43 million increase in the third quarter [8][12] - Core deposit balances decreased by approximately $82 million in the third quarter, primarily due to normal cash flow fluctuations in public fund deposits [12] Market Data and Key Metrics Changes - The Minnesota banking segment is experiencing a slowdown among manufacturing clients due to economic uncertainty, but there are new business opportunities arising from M&A activity in the market [9][10] - The company is focusing on deposit-rich business banking opportunities and has successfully attracted new deposits from high-earning individuals [10] Company Strategy and Development Direction - The company is committed to maintaining strong credit quality and has no past due loans or non-accrual loans [6] - West Bancorporation aims to leverage its strong customer relationships and liquidity to drive growth in a competitive market [8][10] - The company is focused on organic growth and taking advantage of good loan opportunities without specific plans for capital deployment [29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining a solid pace of loan growth, despite being more selective in credit opportunities [19] - The company anticipates favorable conditions for margin expansion due to future Fed rate cuts and loan renewal repricing [4] - Management believes that credit quality will remain strong and expects no significant changes in the operating environment [6][12] Other Important Information - A quarterly dividend of $0.25 per share was declared, payable on November 19, 2025 [5] Q&A Session Summary Question: Update on loan growth pipeline and market share opportunities - The pipeline in Minnesota is good but not as robust as in the past due to selectivity in credit opportunities, with expectations of mid-single-digit growth [18][19] Question: Funding growth outlook with deposits and cash flow - The objective is to fund growth through deposit gathering and cash flows from the investment portfolio, with potential short-term reliance on wholesale funding [22] Question: Update on margin tailwinds and deposit beta assumptions - There are still significant repricing opportunities in the loan portfolio, but deposit betas may not be as aggressive as in the past due to competitive pressures [23][26] Question: Thoughts on future tax rate - The forward tax rate is expected to be similar to the first half of the year, with the third quarter being an anomaly [27] Question: Capital management and deployment priorities - There are no specific plans for capital deployment, but the focus remains on organic growth and good loan opportunities [29]

Financial Data and Key Metrics Changes - West Bancorporation Inc. reported a 16% earnings increase over the prior quarter and a 55% increase compared to the third quarter of the previous year [4] - Net income for the third quarter was $9.3 million, up from $8 million in the second quarter and $6 million in the same quarter last year [11] - The net interest margin improved by nine basis points compared to the previous quarter [11] - Loan yield increased to 5.66% from 5.59% in the second quarter and 5.52% in the first quarter of the year [12] - Core deposit balances decreased by approximately $82 million in the third quarter due to normal cash flow fluctuations [11] Business Line Data and Key Metrics Changes - Loan outstandings were slightly up at just over $3 billion, with a few larger payoffs from asset sales and refinance activity [7] - The commercial real estate portfolio remains well diversified and is performing as expected [6] Market Data and Key Metrics Changes - The Minnesota banking segment is experiencing a slowdown with manufacturing clients due to economic uncertainty, but new business opportunities are arising from M&A activity in the market [8] - The company is focusing on deposit-rich business banking opportunities and has successfully attracted new deposits from high-earning individuals [9] Company Strategy and Development Direction - The company is committed to maintaining strong credit quality and has no past dues or non-accrual loans [6] - There is a focus on organic growth and taking advantage of good loan opportunities, with no specific plans for capital deployment at this time [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining a positive growth pace despite a more selective approach to loan opportunities [16] - The company anticipates continued margin improvements due to fixed-rate loans repricing into higher yields [19] - The effective tax rate is expected to stabilize similar to the first half of the year after a lower rate in the third quarter [20] Other Important Information - A quarterly dividend of $0.25 per share was declared, payable on November 19, 2025 [5] Q&A Session Summary Question: Update on loan growth pipeline and market share in Minnesota - Management indicated that the pipeline is good but not as robust as in the past due to a more selective credit approach, expecting mid-single-digit growth going forward [16] Question: Funding growth outlook with deposit gathering - The objective is to fund growth through cash flows from the investment portfolio and deposit gathering, with potential short-term reliance on wholesale funding [17] Question: Margin tailwinds and deposit beta assumptions - There are still repricing opportunities in the fixed-rate loan portfolio, but deposit betas may not be as aggressive as in the past due to competitive pricing pressure [19] Question: Future tax rate expectations - The forward tax rate is expected to be similar to the first half of the year, with the third quarter being an anomaly [20] Question: Capital management and deployment priorities - No specific plans for capital deployment were mentioned, with a focus on organic growth and good loan opportunities [21]

Financial Data and Key Metrics Changes - West Bancorporation reported a 16% earnings increase over the prior quarter and a 55% increase compared to the third quarter of the previous year [5] - Net income for the third quarter was $9.3 million, up from $8 million in the previous quarter and $6 million in the same quarter last year [17] - The net interest margin improved by nine basis points compared to the previous quarter, with loan yield increasing to 5.66% from 5.59% in the second quarter [17] Business Line Data and Key Metrics Changes - Loan outstandings were slightly up at just over $3 billion, with a $43 million increase in the third quarter [9][16] - Core deposit balances decreased by approximately $82 million in the third quarter, attributed to normal cash flow fluctuations [16] Market Data and Key Metrics Changes - The Minnesota banking segment is experiencing a slowdown among manufacturing clients due to economic uncertainty, but there are new business opportunities arising from M&A activity in the region [11][12] - The company is focusing on deposit-rich business banking opportunities and has successfully attracted new deposits from high-earning individuals [12][14] Company Strategy and Development Direction - The company remains committed to maintaining strong credit quality and underwriting disciplines, with no significant problem loans reported [7][8] - There is a focus on organic growth and taking advantage of good loan opportunities, with no specific plans for capital deployment at this time [31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining a solid loan growth pace, despite being more selective in credit opportunities [23] - The company anticipates favorable conditions from future Fed rate cuts, which will help improve margins [5] Other Important Information - The Board declared a quarterly dividend of $0.25 per share, payable on November 19, 2025 [6] - The effective tax rate for the quarter was around 19%, lower than previous quarters due to a change in estimate on an energy-related investment tax credit [18] Q&A Session Summary Question: Update on loan growth pipeline and market share in Minnesota - Management indicated that the pipeline is good but not as robust as in the past due to selectivity in credit opportunities, expecting mid-single-digit growth going forward [22][23] Question: Funding growth outlook with deposit gathering - The objective is to fund growth through cash flows from the investment portfolio and deposit gathering, with potential short-term reliance on wholesale funding [24] Question: Margin tailwinds and deposit beta assumptions - There are still significant repricing opportunities in the loan portfolio, but deposit betas may not be as aggressive as in the past due to competitive pressures [25][27] Question: Medium-term assessment of Minnesota growth venture - Management expressed confidence that the Minnesota venture has exceeded expectations and is contributing positively to the bottom line [35]

Core Insights - West Bancorp (WTBA) reported quarterly earnings of $0.55 per share, exceeding the Zacks Consensus Estimate of $0.47 per share, and showing an increase from $0.35 per share a year ago, resulting in an earnings surprise of +17.02% [1] - The company achieved revenues of $25 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 3.75% and up from $20.32 million year-over-year [2] - West Bancorp has consistently surpassed consensus EPS estimates over the last four quarters [2] Financial Performance - The earnings surprise of +17.02% indicates strong performance relative to expectations [1] - Revenue growth of 23.1% year-over-year from $20.32 million to $25 million highlights the company's positive financial trajectory [2] - The current consensus EPS estimate for the upcoming quarter is $0.50, with projected revenues of $25.2 million, and for the current fiscal year, the EPS estimate is $1.90 on revenues of $96.4 million [7] Market Position - West Bancorp shares have underperformed the market, losing about 8.4% since the beginning of the year, while the S&P 500 has gained 13.9% [3] - The Zacks Rank for West Bancorp is currently 3 (Hold), suggesting that the stock is expected to perform in line with the market in the near future [6] - The Financial - Savings and Loan industry, to which West Bancorp belongs, is currently in the bottom 30% of Zacks industries, indicating potential challenges ahead [8]

Core Insights - West Bancorporation, Inc. reported a strong third quarter in 2025 with net income of $9.3 million, an increase from $8.0 million in the previous quarter and $6.0 million in the same quarter of 2024 [1][2][3] Financial Performance - Net income for the first nine months of 2025 was $25.1 million, compared to $17.0 million for the same period in 2024 [1] - The company declared a quarterly dividend of $0.25 per common share, payable on November 19, 2025 [1] - Return on average equity improved to 15.25% in Q3 2025 from 13.65% in Q2 2025 and 10.41% in Q3 2024 [3][21] - Return on average assets increased to 0.92% in Q3 2025 from 0.80% in Q2 2025 and 0.60% in Q3 2024 [3][21] - The efficiency ratio improved to 54.06% in Q3 2025 from 56.45% in Q2 2025 and 63.28% in Q3 2024 [3][21] Loan and Deposit Trends - Loans increased by $42.5 million, or 1.4%, in Q3 2025, primarily due to growth in commercial real estate and commercial loans [6] - Deposits decreased by $85.5 million, or 2.5%, in Q3 2025, attributed to normal cash flow fluctuations in core public fund deposits [6] - The allowance for credit losses to total loans was 1.01% as of September 30, 2025, down from 1.03% at June 30, 2025 [6] Interest Income and Margin - Net interest income for Q3 2025 was $22.5 million, up from $21.4 million in Q2 2025 [6][17] - Net interest margin on a fully tax-equivalent basis was 2.36% for Q3 2025, compared to 2.27% in Q2 2025 and 1.91% in Q3 2024 [6][21] Credit Quality - The company reported no loans on nonaccrual status and no loans past due greater than 30 days as of September 30, 2025 [2] - Watch list loans increased from $10.8 million as of June 30, 2025, to $38.7 million as of September 30, 2025, primarily due to one customer relationship [6] Capital Ratios - The tangible common equity ratio was 6.40% as of September 30, 2025, up from 5.94% at June 30, 2025 [6][21] - Total risk-based capital ratio stood at 12.54% as of September 30, 2025, compared to 12.53% at June 30, 2025 [21]

Financial Performance - Third quarter 2025 net income was $9.3 million, or $0.55 per diluted common share, up from $8.0 million, or $0.47 per diluted common share in the second quarter 2025, and $6.0 million, or $0.35 per diluted common share in the third quarter 2024[1]. - Net interest income for the third quarter of 2025 was $22.5 million, up from $21.4 million in the second quarter of 2025[7]. - Net income for the quarter was $9,314,000, representing a 16.7% increase from $7,979,000 in the previous quarter[14]. - Basic earnings per common share rose to $0.55, up from $0.47 in the previous quarter[14]. - For the nine months ended September 30, 2025, total interest income was $143,023,000, compared to $140,750,000 for the same period in 2024[15]. - Net income for the nine months was $25,135,000, compared to $16,953,000 in the same period last year, marking a 48.5% increase[15]. - Earnings per common share (diluted) for Q3 2025 was $0.55, up 17.14% from $0.47 in Q2 2025 and up 57.14% from $0.35 in Q3 2024[16]. Loans and Deposits - Loans increased by $42.5 million, or 1.4 percent, in the third quarter of 2025, primarily driven by an increase in commercial real estate and commercial loans[5]. - Total loans increased to $3,011,775 as of September 30, 2025, up from $2,969,106 on March 31, 2025, representing a growth of 1.04%[13]. - Commercial loans reached $1,912,235 as of September 30, 2025, showing an increase of 1.93% from $1,875,857 on March 31, 2025[13]. - Deposits decreased by $85.5 million, or 2.5 percent, in the third quarter of 2025, with brokered deposits totaling $204.8 million[7]. - Total deposits were $3,306,517 as of September 30, 2025, down 2.51% from $3,391,993 on March 31, 2025[13]. - Noninterest-bearing demand deposits were $512,869 as of September 30, 2025, a decrease of 1.93% from $521,990 on March 31, 2025[13]. Asset Management - Total assets as of September 30, 2025, were $3,985,480, a decrease of 1.75% from $4,056,669 on March 31, 2025[12]. - Average total assets for the quarter ended September 30, 2025, were $4,004,769, slightly down from $4,016,490 for the quarter ended June 30, 2025[12]. - The tangible common equity ratio increased to 6.40 percent as of September 30, 2025, compared to 5.94 percent as of June 30, 2025[7]. - Stockholders' equity increased to $255,133 as of September 30, 2025, up 5.00% from $240,930 on March 31, 2025[13]. Efficiency and Ratios - The efficiency ratio improved to 54.06 percent in the third quarter of 2025, down from 56.45 percent in the second quarter of 2025 and 63.28 percent in the third quarter of 2024[7]. - Return on average assets for Q3 2025 improved to 0.92%, compared to 0.80% in Q2 2025 and 0.60% in Q3 2024[16]. - Total risk-based capital ratio as of September 30, 2025, was 12.54%, slightly up from 12.53% in Q2 2025[16]. - Common equity tier 1 ratio as of September 30, 2025, was 9.37%, up from 9.32% in Q2 2025[16]. - Loans to total deposits ratio increased to 91.00% in Q3 2025, compared to 87.45% in Q2 2025[16]. Dividends and Income - The company declared a regular quarterly dividend of $0.25 per common share, payable on November 19, 2025[1]. - Dividends per common share remained stable at $0.25 for Q3 2025, consistent with previous quarters[16]. - Noninterest income for Q3 2025 was $2,503,000, up from $2,410,000 in Q2 2025[22]. - Noninterest income for the nine months increased to $7,156,000 from $7,004,000 year-over-year[15].

Financial Performance - Net income for Q3 2025 was $9,314, or $0.55 per diluted common share, up from $5,952, or $0.35 per diluted common share in Q3 2024, representing a 56.5% increase [120]. - Net income for the three months ended September 30, 2025, was $9,314,000, a 56.49% increase from $5,952,000 in 2024 [132]. - The annualized return on average equity for Q3 2025 was 15.25%, up from 10.41% in Q3 2024 [120]. - Return on average assets improved to 0.92% in 2025, compared to 0.60% in 2024, reflecting a 0.32% increase [132]. - Return on average equity rose to 15.25% in 2025, up from 10.41% in 2024, marking a 4.84% increase [132]. - The efficiency ratio decreased to 54.06% in 2025, down from 63.28% in 2024, indicating a 9.22% improvement [132]. - Dividend payout ratio significantly decreased to 45.47% in 2025 from 70.71% in 2024, a reduction of 25.24% [132]. Income and Expenses - Net interest income for Q3 2025 increased by $4,541, or 25.3%, to $22,501 compared to $17,960 in Q3 2024 [121]. - Noninterest income for Q3 2025 rose by $144 to $2,503 compared to the same period in 2024 [122]. - Noninterest expense increased by $658 in Q3 2025 compared to Q3 2024, primarily due to higher salaries and employee benefits [122]. - Total noninterest expense for the three months ended September 30, 2025, was $13,550, up 5.10% from $12,892 in 2024 [158]. - Salaries and employee benefits increased by 9.29% to $7,457 for the three months ended September 30, 2025, compared to $6,823 in 2024 [158]. Loans and Assets - Total loans outstanding increased by $4,028, or 0.1%, to $3,008,888 during the first nine months of 2025 [126]. - Average loan balances for the nine months ended September 30, 2025, increased by $9,842, or 0.33%, compared to the same period in 2024 [142]. - Loans outstanding increased by $4,028 to $3,008,888 as of September 30, 2025, with a $51,040 increase in commercial real estate loans [167]. - Total assets decreased to $3,985,480 as of September 30, 2025, from $4,014,991 as of December 31, 2024 [163]. Capital and Ratios - Total stockholders' equity increased to $255,133 at September 30, 2025, from $227,875 at December 31, 2024, primarily due to growth in retained earnings [179]. - The Company's tangible common equity as a percentage of tangible assets was 6.40% as of September 30, 2025, compared to 5.68% as of December 31, 2024 [179]. - The allowance for credit losses was 1.01% of total outstanding loans as of September 30, 2025, indicating adequate coverage for expected losses [126]. - The allowance for credit losses at September 30, 2025, was $30,515, reflecting an increase of $1,096 from $29,419 at the end of September 2024 [153]. - The ratio of allowance for credit losses for loans to average loans outstanding was 1.03% for the three months ended September 30, 2025, compared to 0.98% in 2024 [153]. Interest Rate Risk - Interest rate risk is a primary concern, significantly impacting net income and cash flows due to fluctuations in interest rates [183]. - The company employs an earnings simulation approach to manage interest rate risk and foster consistent growth of earnings and capital [184]. - The Asset Liability Committee meets quarterly to review interest rate sensitivity and develop strategies for managing interest rate risk [185]. - Under a 300 basis points rising interest rate scenario, the estimated change in net interest income is a decrease of $7,824 million, representing an 8.06% decline [187]. - In a 100 basis points falling interest rate scenario, the estimated change in net interest income is an increase of $2,477 million, representing a 2.55% rise [187]. - The simulations for interest rate changes are based on numerous assumptions and may not precisely predict actual results due to market conditions and customer behavior [186]. Dividends and Shareholder Returns - A regular quarterly cash dividend of $0.25 per common share was declared, payable on November 19, 2025 [129].