Core Viewpoint - West Bancorporation, Inc. reported a significant increase in net income for 2025, reflecting strong performance and strategic management, with expectations for continued improvement in 2026 [1][2]. Financial Performance - The net income for 2025 was $32.6 million, or $1.92 per diluted common share, compared to $24.1 million, or $1.42 per diluted common share in 2024 [1]. - The fourth quarter net income was $7.4 million, or $0.43 per diluted common share, down from $9.3 million, or $0.55 per diluted common share in the third quarter of 2025 [1]. - The company declared a quarterly dividend of $0.25 per common share, payable on February 25, 2026 [1]. Balance Sheet and Asset Quality - Loans decreased by $7.2 million, or 0.2 percent, in the fourth quarter of 2025, with no credit loss expense recorded in either the fourth or third quarter [5]. - The allowance for credit losses to total loans was 1.02 percent as of December 31, 2025, compared to 1.01 percent at September 30, 2025 [5]. - There were no nonaccrual loans as of December 31, 2025, indicating strong credit quality [5][10]. Deposits and Interest Income - Deposits increased by $162.0 million, or 4.9 percent, in the fourth quarter of 2025, with a notable increase of $212.2 million, or 6.8 percent, excluding brokered deposits [5]. - The net interest margin was 2.47 percent for the fourth quarter of 2025, up from 2.36 percent in the third quarter [5]. - Net interest income for the fourth quarter was $24.2 million, compared to $22.5 million in the third quarter [5]. Efficiency and Capital Ratios - The efficiency ratio improved to 50.21 percent for the fourth quarter of 2025, down from 54.06 percent in the third quarter [5]. - The tangible common equity ratio was 6.42 percent as of December 31, 2025, compared to 6.40 percent at September 30, 2025 [5]. Year-over-Year Comparison - For the year ended December 31, 2025, net interest margin was 2.35 percent, compared to 1.91 percent for the year ended December 31, 2024 [10]. - Net interest income increased by $17.6 million in 2025 compared to 2024, primarily due to a decrease in interest expense on deposits and borrowed funds [10]. - The efficiency ratio for the year improved to 54.11 percent from 63.25 percent in 2024 [10].

Financial Performance - The Company reported 2025 net income of $32.6 million, or $1.92 per diluted common share, compared to $24.1 million, or $1.42 per diluted common share in 2024[1]. - Net income for the fourth quarter of 2025 was $7.4 million, or $0.43 per diluted common share, down from $9.3 million, or $0.55 per diluted common share in the third quarter of 2025[1]. - Net income for the year ended December 31, 2025, was $32,560,000, an increase of 35.5% compared to $24,050,000 in 2024[19]. - Basic earnings per common share increased to $1.92 in 2025 from $1.43 in 2024, reflecting a growth of 34.3%[19]. - Earnings per common share (diluted) for Q4 2025 was $0.43, compared to $0.55 in Q3 2025[12]. - Basic earnings per common share for the quarter ended December 31, 2025, was $0.44, a decrease from $0.55 in the previous quarter[18]. Deposits and Loans - Deposits increased by $162.0 million, or 4.9 percent, in the fourth quarter of 2025, with a total of $154.6 million in brokered deposits[4]. - Total deposits increased to $3,468,470 as of December 31, 2025, up 4.9% from $3,306,517 on September 30, 2025[17]. - Loans totaled $3,001,690 thousand in Q4 2025, slightly down from $3,008,888 thousand in Q3 2025[16]. - Total loans as of December 31, 2025, amounted to $3,001,690, a slight decrease of 0.3% from $3,008,888 on September 30, 2025[17]. - Net loans stood at $2,971,165 as of December 31, 2025, compared to $2,978,373 on September 30, 2025, reflecting a decrease of 0.2%[17]. Interest Income and Margin - The net interest margin for the fourth quarter of 2025 was 2.47 percent, up from 2.36 percent in the third quarter of 2025, with net interest income rising to $24.2 million[4]. - Net interest margin improved to 2.47% in Q4 2025 compared to 2.36% in Q3 2025[12]. - Total interest income for the year ended December 31, 2025, was $192,225,000, an increase of 1.1% from $190,066,000 in 2024[19]. - Net interest income after credit loss expense rose to $88,981,000 in 2025, compared to $70,362,000 in 2024, reflecting a significant increase of 26.6%[19]. - The net interest margin on a FTE basis for the year was 2.35%, up from 1.91% in 2024, showing an improvement of 23%[22]. Efficiency and Ratios - The efficiency ratio improved to 50.21 percent in the fourth quarter of 2025, compared to 54.06 percent in the third quarter of 2025[8]. - The efficiency ratio improved to 50.21% in Q4 2025 from 54.06% in Q3 2025[12]. - The efficiency ratio on an adjusted and FTE basis improved to 54.11% in 2025 from 63.25% in 2024, indicating enhanced operational efficiency[22]. - The total risk-based capital ratio increased to 12.77% in Q4 2025 from 12.54% in Q3 2025[12]. - The tangible common equity ratio was 6.42 percent as of December 31, 2025, compared to 6.40 percent at September 30, 2025[8]. Credit Quality - The Company recorded no credit loss expense in 2025, compared to $1.0 million in 2024, reflecting strong credit quality[8]. - The allowance for credit losses remained stable at $30,525 as of December 31, 2025, compared to $30,515 on September 30, 2025[17]. - Watch list loans increased from $38.7 million to $52.2 million from September 30, 2025, to December 31, 2025, primarily due to one commercial real estate loan[4]. Stock Performance - The closing stock price rose to $22.19 in Q4 2025 from $20.32 in Q3 2025[12]. Future Reporting - The Company plans to file its report on Form 10-K with the SEC on or before February 26, 2026, for a more detailed discussion of financial results[7].

Core Viewpoint - Options markets are indicating significant post-earnings volatility for several stocks, particularly regional banks, with expectations of price swings being amplified by the Federal Reserve's policy decision [1][2]. Group 1: Implied Moves and Earnings Reports - Options markets are pricing in double-digit to near-50% post-earnings swings for a group of regional banks [2]. - Ten stocks are highlighted with implied moves of approximately 30% or more ahead of their earnings reports this week [3]. - Capitol Federal Financial, Inc. is expected to have the highest implied move at 48.48%, with earnings per share projected at 15 cents and revenue at $57.51 million [5][6]. - First Financial Bancorp follows closely with a 47.50% implied move, expecting earnings per share of 56 cents and revenue of $245.83 million [5][6]. - Other notable stocks include Provident Financial Services, Inc. (39.22% implied move), First BanCorp (39.09% implied move), and West Bancorporation, Inc. (35.92% implied move) [5][6]. Group 2: Specific Stock Details - Beacon Financial Corp. anticipates earnings per share of 79 cents and revenue of $224.81 million, with an implied move of 29.48% [5]. - ConnectOne Bancorp, Inc. expects earnings per share of 73 cents and revenue of $110.15 million, with an implied move of 29.51% [5]. - High Tide Inc., the only non-bank on the list, is set to report earnings per share of $0.01 and revenue of $114.95 million, with an implied move of 30.12% [5]. - Primis Financial Corp. is projected to have earnings per share of $1.10 and revenue of $34.98 million, with an implied move of 31.17% [5]. - Hope Bancorp, Inc. expects earnings per share of 26 cents and revenue of $142.91 million, with an implied move of 32.94% [5].

Core Insights - The Zacks Savings and Loan industry is benefiting from an improving lending environment due to recent Federal Reserve rate cuts, which are expected to stabilize funding costs and enhance net interest income (NII) and net interest margin (NIM) [1][4]. Industry Overview - The Zacks Savings and Loan industry comprises specialized U.S. banks focused on residential mortgage finance, offering various loan products and funding mortgages with FDIC-insured savings [3]. - The industry has seen a shift in regulations, allowing institutions to invest more flexibly, which can enhance their lending capabilities [3]. Trends and Developments - Lower interest rates are anticipated to boost loan demand, with the Federal Reserve cutting rates by 50 basis points this year and a further 100 basis points expected in 2024 [4]. - Recent declines in mortgage rates are improving purchase originations and refinancing activities, which is likely to increase borrower confidence [5]. - The industry is undergoing digital transformation to enhance operational efficiency and competitiveness, despite initial cost increases [6][7]. Asset Quality and Performance - Declining interest rates are helping borrowers maintain timely payments, potentially reducing the need for large reserves against defaults [7]. - However, a slight increase in non-performing loans is expected, with some credit quality metrics remaining elevated compared to pre-pandemic levels [8]. Market Position and Valuation - The Zacks Savings and Loan industry ranks 96 among over 243 Zacks industries, placing it in the top 40% and indicating solid near-term prospects [9][10]. - The industry's current-year earnings estimate has increased by 43.2% over the past year, reflecting growing analyst confidence [11]. - The industry has underperformed the broader Zacks Finance sector and the S&P 500, with a collective decline of 12.2% over the past year [13]. Valuation Metrics - The industry has a trailing 12-month price-to-tangible book (P/TB) ratio of 1.97X, below the five-year median of 2.13X, indicating a discount compared to the broader market [17][19]. - The Zacks Finance sector's P/TB ratio stands at 5.93X, further highlighting the relative valuation attractiveness of the savings and loan industry [19]. Company Highlights - **Northpointe Bancshares Inc. (NPB)**: Focused on mortgage lending, with a 6.8% sequential growth in gross loans in Q3 2025. The bank's total deposits increased by $295.6 million, indicating strong funding stability [20][21][22]. NPB has a Zacks Rank 2 (Buy) with earnings estimates indicating growth of 19.7% and 24.4% for 2025 and 2026, respectively [24]. - **West Bancorporation (WTBA)**: A community bank emphasizing stable funding sources and digital banking enhancements. Total loans increased by 1.4% in Q3 2025, with NII rising around 25% year-over-year [27][28]. WTBA holds a Zacks Rank 1 (Strong Buy) with earnings estimates showing increases of 43.7% and 17.7% for 2025 and 2026, respectively [30]. - **Citizens Community Bancorp, Inc. (CZWI)**: Focuses on organic growth and acquisitions, with a strategy to improve its loan portfolio and deposit mix. As of Q3 2025, non-performing assets were 0.96% of total assets, slightly up from the previous year [33][35]. CZWI has a Zacks Rank 2 with earnings estimates indicating growth of 2.2% and 26.8% for 2025 and 2026, respectively [36].

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]