West Bancorporation(US:WTBA)2025-10-23 11:10Financial 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].