Westamerica Bancorporation(WABC) - 2024 Q3 - Quarterly Report

Financial Performance - Total interest and loan fee income for Q3 2024 was $67,794, a decrease of 7.1% from $72,848 in Q3 2023[14] - Net income for Q3 2024 was $35,057, down 15.5% from $41,601 in Q3 2023[14] - Basic earnings per share for Q3 2024 were $1.31, compared to $1.56 in Q3 2023, reflecting a decline of 16.0%[14] - Total noninterest income for Q3 2024 was $11,925, an increase of 5.7% from $11,281 in Q3 2023[14] - Total noninterest expense for Q3 2024 was $26,309, up 2.6% from $25,650 in Q3 2023[14] - The company reported a total comprehensive income of $104,704 for Q3 2024, significantly higher than $7,935 in Q3 2023[16] - The company paid dividends of $0.44 per share in Q3 2024, consistent with Q3 2023[14] - Net income for the period ended September 30, 2024, was $106,936 thousand, compared to $122,300 thousand for the same period in 2023, reflecting a decrease of approximately 12.5%[20] - Total shareholders' equity as of September 30, 2024, was $909,040 thousand, an increase from $648,423 thousand as of September 30, 2023, representing a growth of approximately 40.1%[18] Credit Losses and Loan Quality - The provision for credit losses was $0 in Q3 2024, compared to a reversal of $400 in Q3 2023[14] - The allowance for credit losses increased to $15,318,000 as of September 30, 2024, compared to $16,867,000 at the end of 2023, reflecting a reduction of approximately 9.2%[65] - The credit risk profile shows that $807,651,000 of loans were assigned a "Pass" grade, representing the majority of the total loans outstanding[68] - The company reported no debt securities held to maturity on nonaccrual status or past due 30 days or more as of September 30, 2024[62] - The total allowance for credit losses for the nine months ended September 30, 2024, was $15,318,000, reflecting a decrease from the previous year[67] - The company maintains a Loan Review Department that performs independent evaluations of loans, ensuring compliance with regulatory standards[67] - Nonaccrual loans totaled $403 thousand, with no allowance for credit losses allocated to these loans as of September 30, 2024[70] - The risk category of loans showed $22,595 thousand classified as pass grade, with $2,672 thousand as substandard[73] Deposits and Cash Flow - The company experienced a net change in deposits of $(409,217) thousand for the period ended September 30, 2024, compared to $(526,277) thousand in the prior year, indicating a smaller outflow[20] - As of September 30, 2024, total deposits amounted to $5,065,050 thousand, a decrease from $5,474,267 thousand on December 31, 2023, representing a decline of approximately 7.5%[102] - Noninterest-bearing deposits were $2,375,958 thousand at September 30, 2024, down from $2,605,844 thousand at December 31, 2023, indicating a decrease of about 8.8%[102] - The company reported net cash provided by operating activities for the period ended September 30, 2024, of $111,799 thousand, down from $166,189 thousand in the previous year, indicating a decline of about 32.7%[20] - The company experienced a net cash used in financing activities of $370,020 thousand for the period ended September 30, 2024, compared to $516,696 thousand in the previous year, reflecting a reduction of approximately 28.3%[20] Investment Securities - The company reported total debt securities available for sale at an amortized cost of $3,761,718 thousand and a fair value of $3,580,486 thousand as of September 30, 2024, reflecting gross unrealized losses of $183,797 thousand[47] - The amortized cost of debt securities held to maturity was $850,262 thousand, with a fair value of $837,080 thousand, indicating gross unrealized losses of $15,152 thousand[47] - The total amortized cost of all debt securities was $4,611,980 thousand, with a fair value of $4,417,566 thousand, resulting in total gross unrealized losses of $198,949 thousand[48] - The company reported gross unrealized gains of $2,565 thousand on debt securities available for sale as of September 30, 2024[47] - The company holds $2,057,115 thousand in corporate securities, with a fair value of $1,901,617 thousand, reflecting significant unrealized losses[47] - The total fair value of debt securities available for sale was $2,906,499 thousand, with significant unrealized losses concentrated in corporate securities[52] Economic Outlook and Management Strategies - The company anticipates continued economic uncertainty and competitive pressure in the banking industry affecting future performance[9] - Management continues to evaluate the impacts of inflation, Federal Reserve's monetary policy, and climate changes on the Company's business[2] - The company does not intend to sell any debt securities available for sale with material unrealized losses, indicating a long-term holding strategy[54] - The Company continuously monitors market conditions, including interest rate changes and credit ratings, to assess the impact on the value of its debt securities[56] - The company aims to improve its credit loss allowance by closely monitoring the delinquency and nonaccrual status of its loan portfolio[81]