• West Bancorporation, Inc. Announces Record Net Income, Declares Increased Quarterly Dividend

    المصدر: Nasdaq GlobeNewswire / 27 يناير 2022 07:30:01   America/Chicago

    WEST DES MOINES, Iowa, Jan. 27, 2022 (GLOBE NEWSWIRE) -- West Bancorporation, Inc. (Nasdaq: WTBA; the “Company”), parent company of West Bank, today reported 2021 net income was $49.6 million, or $2.95 per diluted common share, compared to 2020 net income of $32.7 million, or $1.98 per diluted common share. Net income for the fourth quarter of 2021 was $11.9 million, or $0.71 per diluted common share, compared to fourth quarter 2020 net income of $8.6 million, or $0.52 per diluted common share. On January 26, 2022, the Company’s Board of Directors declared a regular quarterly dividend of $0.25 per common share, an increase of $0.01 from the prior quarter and representing a record high quarterly dividend for the Company. The dividend is payable on February 23, 2022, to stockholders of record on February 9, 2022.

    The Company recorded negative provision for loan losses of $1,500 for the year ended December 31, 2021, compared to provision for loan losses of $12,000 for the year ended December 31, 2020. The provision in 2020 was due to the onset of the global pandemic, whereas 2021 includes a reserve release due to the improving economic outlook.

    David Nelson, President and Chief Executive Officer of the Company, commented, “West Bancorporation, Inc. experienced extraordinary financial performance in 2021. Net income increased 52 percent in 2021, compared to 2020, and net interest income increased 15 percent in 2021, compared to 2020. Total assets were $3.5 billion at December 31, 2021, compared to $3.2 billion at December 31, 2020. We experienced loan growth (exclusive of Paycheck Protection Program loan activity) of 16 percent and deposit growth of 12 percent in 2021. Our credit quality continues to improve as classified and impaired loans were paid down and paid off. As of December 31, 2021, the Texas ratio declined to 3.10 percent and there were no loans past due more than 30 days.”

    David Nelson added, “We currently have four new bank building projects in various stages of planning and development. These buildings represent our commitment to our customers, our employees and the communities we serve as we continue our pursuit of excellence.”

    The Company will file its report on Form 10-K with the Securities and Exchange Commission on or before February 24, 2022. Please refer to that document for a more in-depth discussion of the Company’s financial results. The Form 10-K will be available on the Investor Relations section of West Bank’s website at www.westbankstrong.com.

    The Company will discuss its financial results on a conference call scheduled for 10:00 a.m. Central Time tomorrow, Friday, January 28, 2022. The telephone number for the conference call is 888-339-0814. A recording of the call will be available until February 11, 2022, by dialing 877-344-7529. The replay passcode is 3153348.

    About West Bancorporation, Inc. (Nasdaq: WTBA)

    West Bancorporation, Inc. is headquartered in West Des Moines, Iowa. Serving customers since 1893, West Bank, a wholly-owned subsidiary of West Bancorporation, Inc., is a community bank that focuses on lending, deposit services, and trust services for small- to medium-sized businesses and consumers. West Bank has seven offices in the Des Moines, Iowa metropolitan area, one office in Coralville, Iowa, and four offices in Minnesota in the cities of Rochester, Owatonna, Mankato and St. Cloud.

    Certain statements in this report, other than purely historical information, including estimates, projections, statements relating to the Company’s business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meanings of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements may appear throughout this report. These forward-looking statements are generally identified by the words “believes,” “expects,” “intends,” “anticipates,” “projects,” “future,” “confident,” “may,” “should,” “will,” “strategy,” “plan,” “opportunity,” “will be,” “will likely result,” “will continue” or similar references, or references to estimates, predictions or future events. Such forward-looking statements are based upon certain underlying assumptions, risks and uncertainties. Because of the possibility that the underlying assumptions are incorrect or do not materialize as expected in the future, actual results could differ materially from these forward-looking statements.  Risks and uncertainties that may affect future results include: the effects of the COVID-19 pandemic, including its effects on the economic environment, our customers and our operations, including due to supply chain disruptions, as well as any changes to federal, state or local government laws, regulations or orders in connection with the pandemic; interest rate risk; competitive pressures, including from non-bank competitors such as “fintech” companies; pricing pressures on loans and deposits; changes in credit and other risks posed by the Company’s loan and investment portfolios, including declines in commercial or residential real estate values or changes in the allowance for loan losses dictated by new market conditions, accounting standards (including as a result of the future implementation of the current expected credit loss (CECL) accounting standard) or regulatory requirements; changes in local, national and international economic conditions, including rising rates of inflation; changes in legal and regulatory requirements, limitations and costs; changes in customers’ acceptance of the Company’s products and services; cyber-attacks; unexpected outcomes of existing or new litigation involving the Company; the monetary, trade and other regulatory policies of the U.S. government, including anticipated rate increases; acts of war or terrorism, widespread disease or pandemics, such as the COVID-19 pandemic, or other adverse external events; developments and uncertainty related to the future use and availability of some reference rates, such as the London Interbank Offered Rate, as well as other alternative reference rates; changes to U.S. tax laws, regulations and guidance; liquidity risk due to excess liquidity at the Company’s bank subsidiary; talent and labor shortages; and any other risks described in the “Risk Factors” sections of reports filed by the Company with the Securities and Exchange Commission. The Company undertakes no obligation to revise or update such forward-looking statements to reflect current or future events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

    WEST BANCORPORATION, INC. AND SUBSIDIARY    
    Financial Information (unaudited)    
    (in thousands)    
         
    CONSOLIDATED BALANCE SHEETS December 31, 2021 December 31, 2020
    Assets    
    Cash and due from banks $17,555  $77,693 
    Federal funds sold  175,270   318,742 
    Securities available for sale, at fair value  758,822   420,571 
    Federal Home Loan Bank stock, at cost  9,965   11,723 
    Loans  2,456,196   2,280,575 
    Allowance for loan losses  (28,364)  (29,436)
    Loans, net  2,427,832   2,251,139 
    Premises and equipment, net  34,568   29,077 
    Bank-owned life insurance  43,609   42,686 
    Other assets  32,580   34,113 
    Total assets $3,500,201  $3,185,744 
         
    Liabilities and Stockholders’ Equity    
    Deposits:    
    Noninterest-bearing demand $720,136  $696,731 
    Interest-bearing:    
    Demand  548,242   553,881 
    Savings  1,550,636   1,274,254 
    Time of $250 or more  53,019   46,907 
    Other time  143,972   129,221 
    Total deposits  3,016,005   2,700,994 
    Federal funds purchased  2,880   5,375 
    Other borrowings  196,986   217,010 
    Other liabilities  24,002   38,670 
    Stockholders’ equity  260,328   223,695 
    Total liabilities and stockholders’ equity $3,500,201  $3,185,744 


    WEST BANCORPORATION, INC. AND SUBSIDIARY      
    Financial Information (continued) (unaudited)        
    (in thousands)        
             
      Three Months Ended December 31, Year Ended December 31,
    CONSOLIDATED STATEMENTS OF INCOME  2021   2020   2021   2020 
    Interest income        
    Loans, including fees $24,179  $23,536  $95,585  $90,668 
    Securities  3,419   2,162   11,403   9,261 
    Other  66   48   292   304 
    Total interest income  27,664   25,746   107,280   100,233 
    Interest expense        
    Deposits  2,055   1,913   7,948   11,256 
    Federal funds purchased  1   2   5   23 
    Other borrowings  1,006   1,341   4,268   6,121 
    Total interest expense  3,062   3,256   12,221   17,400 
    Net interest income  24,602   22,490   95,059   82,833 
    Provision for loan losses  —   4,000   (1,500)  12,000 
    Net interest income after provision for loan losses  24,602   18,490   96,559   70,833 
    Noninterest income        
    Service charges on deposit accounts  603   617   2,352   2,360 
    Debit card usage fees  505   427   1,948   1,632 
    Trust services  633   601   2,671   2,078 
    Increase in cash value of bank-owned life insurance  233   166   923   593 
    Loan swap fees  24   —   66   1,572 
    Realized securities gains (losses), net  —   (4)  51   77 
    Other income  350   297   1,718   1,290 
    Total noninterest income  2,348   2,104   9,729   9,602 
    Noninterest expense        
    Salaries and employee benefits  5,928   5,577   23,226   21,591 
    Occupancy  1,532   1,228   5,162   4,879 
    Data processing  630   575   2,465   2,331 
    FDIC insurance  460   330   1,818   1,210 
    Other expenses  3,321   2,205   10,709   9,043 
    Total noninterest expense  11,871   9,915   43,380   39,054 
    Income before income taxes  15,079   10,679   62,908   41,381 
    Income taxes  3,169   2,125   13,301   8,669 
    Net income $11,910  $8,554  $49,607  $32,712 


    WEST BANCORPORATION, INC. AND SUBSIDIARY  
    Financial Information (continued) (unaudited)        
             
           
      PER COMMON SHARE MARKET INFORMATION (1)
      Net Income      
      Basic Diluted Dividends High Low
    2021          
    4th Quarter $0.72  $0.71  $0.24  $34.50  $29.30 
    3rd Quarter  0.77   0.76   0.24   31.98   26.26 
    2nd Quarter  0.80   0.79   0.24   29.90   23.92 
    1st Quarter  0.71   0.70   0.22   26.78   18.86 
               
    2020          
    4th Quarter $0.52  $0.52  $0.21  $21.79  $15.53 
    3rd Quarter  0.49   0.49   0.21   17.99   15.50 
    2nd Quarter  0.48   0.48   0.21   20.67   14.50 
    1st Quarter  0.49   0.49   0.21   25.68   13.74 


    (1) The prices shown are the high and low sale prices for the Company’s common stock, which trades on the Nasdaq Global Select Market under the symbol WTBA. The market quotations, reported by Nasdaq, do not include retail markup, markdown or commissions.



      Three Months Ended December 31, Year Ended December 31,
    SELECTED FINANCIAL MEASURES 2021 2020 2021 2020
    Return on average assets 1.38% 1.15% 1.52% 1.19%
    Return on average equity 18.51% 15.54% 20.33% 15.49%
    Net interest margin on a FTE basis (1) 3.00% 3.20% 3.05% 3.20%
    Efficiency ratio (1)(2) 43.32% 39.99% 40.91% 41.96%
             
        As of December 31,
          2021 2020
    Texas ratio (2)     3.10% 6.40%
    Allowance for loan losses ratio     1.15% 1.29%
    Allowance for loan losses ratio, excluding PPP loans (1)(3)   1.17% 1.40%
    Tangible common equity ratio     7.44% 7.02%


    (1) Non-GAAP financial measures - see reconciliation below
    (2) A lower ratio is more desirable
    (3) Paycheck Protection Program (PPP)

    Definitions of ratios:

    • Return on average assets - annualized net income divided by average assets.
    • Return on average equity - annualized net income divided by average stockholders’ equity.
    • Net interest margin - annualized tax-equivalent net interest income divided by average interest-earning assets.
    • Efficiency ratio - noninterest expense (excluding other real estate owned expense) divided by noninterest income (excluding net securities gains/losses and gains/losses on disposition of premises and equipment) plus tax-equivalent net interest income.
    • Texas ratio - total nonperforming assets divided by tangible common equity plus the allowance for loan losses.
    • Allowance for loan losses ratio - allowance for loan losses divided by total loans.
    • Allowance for loan losses ratio, excluding PPP loans - allowance for loan losses divided by total loans minus the amount of PPP loans.
    • Tangible common equity ratio - common equity less intangible assets (none held) divided by tangible assets.


    WEST BANCORPORATION, INC. AND SUBSIDIARY
    Financial Information (continued) (unaudited)
    (dollars in thousands)

    NON-GAAP FINANCIAL MEASURES

    This press release contains references to financial measures that are not defined in generally accepted accounting principles (GAAP). The following table reconciles the non-GAAP financial measures of net interest income and net interest margin on a fully taxable equivalent (FTE) basis, efficiency ratio on an adjusted and FTE basis, loans, net of PPP loans and allowance for loan losses ratio, excluding PPP loans, to their most directly comparable measures under GAAP.

      Three Months Ended December 31, Year Ended December 31,
       2021   2020   2021   2020 
    Reconciliation of net interest income and net interest margin on a FTE basis to GAAP:        
    Net interest income (GAAP) $24,602  $22,490  $95,059  $82,833 
    Tax-equivalent adjustment (1)  397   191   1,202   707 
    Net interest income on a FTE basis (non-GAAP)  24,999   22,681   96,261   83,540 
    Average interest-earning assets  3,309,625   2,822,563   3,152,138   2,614,342 
    Net interest margin on a FTE basis (non-GAAP)  3.00%  3.20%  3.05%  3.20%
             
    Reconciliation of efficiency ratio on an adjusted and FTE basis to GAAP:        
    Net interest income on a FTE basis (non-GAAP) $24,999  $22,681  $96,261  $83,540 
    Noninterest income  2,348   2,104   9,729   9,602 
    Adjustment for realized securities (gains) losses, net  —   4   (51)  (77)
    Adjustment for losses on disposal of premises and equipment, net  55   6   84   9 
    Adjusted income  27,402   24,795   106,023   93,074 
    Noninterest expense  11,871   9,915   43,380   39,054 
    Efficiency ratio on an adjusted and FTE basis (non-GAAP) (2)  43.32%  39.99%  40.91%  41.96%
             
          As of December 31,
           2021   2020 
    Reconciliation of allowance for loan losses ratio, excluding PPP loans:      
    Loans outstanding (GAAP)     $2,456,196  $2,280,575 
    Less: PPP loans      (22,206)  (180,757)
    Loans, net of PPP loans (non-GAAP)      2,433,990   2,099,818 
    Allowance for loan losses      28,364   29,436 
    Allowance for loan losses ratio, excluding PPP loans (non-GAAP) (3)    1.17%  1.40%


    (1) Computed on a tax-equivalent basis using a federal income tax rate of 21 percent, adjusted to reflect the effect of the nondeductible interest expense associated with owning tax-exempt securities and loans. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the financial results, as it enhances the comparability of income arising from taxable and nontaxable sources.
    (2) The efficiency ratio expresses noninterest expense as a percent of fully taxable equivalent net interest income and noninterest income, excluding specific noninterest income and expenses. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the Company’s financial performance. It is a standard measure of comparison within the banking industry. A lower ratio is more desirable.
    (3) Management believes that presenting the allowance for loan losses as a percentage of total loans excluding PPP loans is useful in assessing the credit quality of the Company’s core portfolio.



    For more information contact:
    Jane Funk, Executive Vice President, Treasurer and Chief Financial Officer (515) 222-5766


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