Westamerica Bancorporation(US:WABC)2025-08-06 18:23Financial Performance - Net income for the three months ended June 30, 2025, was $29,066 thousand, a decrease of 18.5% compared to $35,462 thousand for the same period in 2024[21]. - Net income for the six months ended June 30, 2025, was $60,103,000, compared to $71,879,000 for the same period in 2024, representing a decrease of approximately 16.3%[27]. - Basic earnings per share for the three months ended June 30, 2025, were $1.12, down from $1.33 in the same period of 2024, representing a decline of 15.8%[21]. - The company reported a total comprehensive income of $49,087 thousand for the three months ended June 30, 2025, compared to $35,019 thousand in 2024, an increase of 40.1%[23]. - The company reported a provision for income taxes of $9,998 thousand for the three months ended June 30, 2025, down from $12,673 thousand for the same period in 2024, a decrease of 21.0%[21]. Asset and Deposit Changes - Total assets decreased to $5,825,069 thousand as of June 30, 2025, down from $6,076,274 thousand at December 31, 2024, representing a decline of approximately 4.1%[19]. - Total deposits decreased to $4,747,535 thousand as of June 30, 2025, from $5,011,850 thousand at December 31, 2024, a decline of approximately 5.3%[19]. - The company experienced a net change in deposits of $(264,315,000) for the six months ended June 30, 2025, compared to $(342,827,000) in the same period of 2024[27]. - The balance of common shares outstanding decreased from 26,708,000 on December 31, 2024, to 25,587,000 on June 30, 2025[25]. Income and Expense Analysis - Total interest and loan fee income for the six months ended June 30, 2025, was $116,958 thousand, down 15.2% from $137,818 thousand in the same period of 2024[21]. - Noninterest income for the three months ended June 30, 2025, was $10,315 thousand, slightly down from $10,500 thousand in 2024, indicating a decrease of 1.8%[21]. - Total noninterest expense for the six months ended June 30, 2025, was $50,656 thousand, a reduction of 3.3% compared to $52,229 thousand in the same period of 2024[21]. Credit Losses and Loan Performance - The allowance for credit losses on loans was $13,787 thousand as of June 30, 2025, compared to $14,780 thousand at December 31, 2024, reflecting a decrease of 6.7%[19]. - The total loans outstanding as of June 30, 2025, were $748,264 thousand, down from $820,300 thousand at December 31, 2024[72]. - The provision for credit losses for commercial loans increased due to an increase in estimated credit losses over the remaining life of loans[74]. - The total allowance for credit losses at June 30, 2025, was $13,787 thousand, reflecting an increase primarily due to estimated credit losses on individually evaluated loans totaling $3.6 million[74]. Investment Securities and Fair Value - The Company classifies investment securities as Level 1, Level 2, or Level 3 in the fair value hierarchy based on the reliability of pricing sources[34]. - As of June 30, 2025, the total fair value of debt securities available for sale is $3,226,449,000, with unrealized losses of $166,533,000[60]. - The total amortized cost of debt securities held to maturity is $834,440,000, with a fair value of $817,719,000, resulting in unrealized losses of $17,914,000[58]. - The total gross unrealized losses for debt securities available for sale include $139,558,000 from corporate securities, which is the largest component of the losses[60]. Operational and Economic Outlook - The company anticipates continued challenges in the economic environment, which may impact future performance and financial condition[15]. - The company continues to evaluate the impacts of inflation and monetary policy on its operations, indicating potential volatility in the banking industry[30]. - The company is focusing on maintaining a strong credit quality while managing the risks associated with the increasing substandard loans[81]. Other Financial Metrics - Total cash and due from banks at the end of the period was $626,437,000, an increase from $486,124,000 at the end of June 2024[27]. - Net cash provided by operating activities for the six months ended June 30, 2025, was $65,911,000, compared to $71,246,000 for the same period in 2024, indicating a decline of about 7.3%[27]. - The company paid dividends of $23,772,000 for the six months ended June 30, 2025, compared to $23,474,000 in the same period of 2024[27].