Westamerica Bancorporation(US:WABC)2022-11-08 18:48Financial Performance - Net income for the three months ended September 30, 2022, was $34,760 thousand, an increase of 57.5% compared to $22,063 thousand for the same period in 2021[17]. - Basic earnings per share for the three months ended September 30, 2022, were $1.29, up from $0.82 in the same period of 2021, marking a growth of 57.3%[17]. - Net income for the nine months ended September 30, 2022, was $82.69 million, an increase from $64.79 million in the same period of 2021, representing a growth of approximately 27.5%[25]. - Noninterest income increased to $11,818 thousand for the three months ended September 30, 2022, compared to $11,282 thousand in the same period of 2021, reflecting a growth of 4.8%[17]. - Total interest and loan fee income rose to $60,802 thousand for the three months ended September 30, 2022, up 38.8% from $43,810 thousand in the same period of 2021[17]. Asset and Equity Changes - Total assets decreased to $7,177,025 thousand as of September 30, 2022, down from $7,461,026 thousand at December 31, 2021, representing a decline of approximately 3.8%[14]. - The company's total shareholders' equity decreased to $538,988 thousand as of September 30, 2022, down from $827,102 thousand at December 31, 2021, a decline of approximately 34.8%[14]. - Total deposits grew to $6,495,256 thousand as of September 30, 2022, compared to $6,413,956 thousand at December 31, 2021, indicating an increase of approximately 1.3%[14]. - Total cash and due from banks at the end of the period was $413.67 million, down from $1.01 billion at the beginning of the period, indicating a decrease of about 61.2%[25]. Credit Loss and Loan Performance - The allowance for credit losses decreased to $21,218 thousand at September 30, 2022, from $23,514 thousand at December 31, 2021, indicating improved credit quality[14]. - The provision for credit losses remained at $0 for the three months ended September 30, 2022, consistent with the same period in 2021[17]. - The total loans amounted to $979,033,000, with $971,241,000 classified as current and past due and accruing[74]. - The credit risk profile showed that $963,089,000 of loans were assigned a "pass" grade, indicating minimal likelihood of loss[71]. - The company reported a total of $14,235,000 in loans classified as substandard, with $739,000 classified as doubtful and $970,000 as loss[71]. Investment Securities - The total amortized cost of debt securities available for sale was $4,789,181 thousand, with a fair value of $4,376,331 thousand, reflecting unrealized losses of $414,485 thousand[50]. - The total amortized cost of debt securities held to maturity was $936,274 thousand, with a fair value of $878,462 thousand, resulting in unrealized losses of $57,861 thousand[51]. - The company holds $2,491,591 thousand in corporate securities, with unrealized losses of $354,168 thousand as of September 30, 2022[50]. - The company utilizes third-party sources to value its investment securities, classifying them as Level 1, Level 2, or Level 3 based on the reliability of the pricing information[30]. Cash Flow and Dividends - Net cash provided by operating activities for the nine months ended September 30, 2022, was $71.88 million, compared to $71.13 million in 2021, showing a slight increase of 1.1%[25]. - Total dividends paid during the nine months ended September 30, 2022, amounted to $33.88 million, compared to $33.02 million in 2021, reflecting an increase of approximately 2.6%[25]. - The company experienced a net cash used in investing activities of $770.32 million for the nine months ended September 30, 2022, compared to $268.66 million in 2021, indicating a substantial increase in investment outflows[25]. Loan Commitments and Other Assets - The company had loan commitments related to real estate loans amounting to $33,342 thousand at September 30, 2022, compared to $34,226 thousand at December 31, 2021, a decline of approximately 2.6%[87]. - Total other assets rose significantly to $340,874 thousand at September 30, 2022, compared to $185,415 thousand at December 31, 2021, marking an increase of approximately 83.9%[88]. - The net deferred tax asset increased to $139,887 thousand as of September 30, 2022, from a net deferred tax liability of $2,501 thousand at December 31, 2021[88]. Risk Management and Compliance - The Company maintains a separate allowance for credit losses from off-balance-sheet credit exposures, which is included within other liabilities[47]. - The Company follows guidance from the Federal Reserve when performing investment security pre-purchase analysis or evaluating investment securities for credit loss[31]. - The Loan Review Department conducts continuous evaluations of loans, ensuring that credit risk grades are promptly re-evaluated if borrower performance deteriorates[70]. - The company maintains a proactive approach to credit risk management, with independent evaluations performed by the Loan Review Department[70].