West Bancorporation, Inc. Increases Quarterly Dividend By 10 Percent; Stock Repurchase Authorization Put In Place; Announces Second Quarter Results

WEST DES MOINES, Iowa, July 26, 2013 /PRNewswire/ -- West Bancorporation, Inc. (NASDAQ: WTBA) (the "Company"), parent company of West Bank, is pleased to report that at its meeting on July 24, 2013, the Board of Directors increased the quarterly dividend by 10 percent to $0.11 per share.  The dividend is payable on August 27, 2013, to shareholders of record on August 7, 2013. 

"We are pleased to announce the quarterly dividend increase.  West Bancorporation, Inc. is well-capitalized and we believe that our earnings outlook continues to be favorable.  These factors, combined with our emphasis on organic growth, allow us to provide this increase to our shareholders," stated David Nelson, President and Chief Executive Officer.

On July 24, 2013, the Board of Directors also authorized management to repurchase up to $2 million of the Company's common stock between now and the next annual board organizational meeting in April 2014.  The authorization does not require such purchases and is subject to certain restrictions.  Shares of Company common stock may be repurchased on the open market or in privately negotiated transactions.  The extent to which the shares are repurchased, if any, and the timing of such repurchase will depend on market conditions and other corporate considerations.

For the second quarter of 2013, net income was $4.30 million, or $0.25 per diluted common share.  This compares to net income for the second quarter of 2012 of $4.38 million, which was also $0.25 per diluted common share.

"While net income for the second quarter of 2013 was $85,000 lower than the second quarter of last year, we feel the nature of the earnings for the most recent quarter was stronger," added Nelson.  Last year's second quarter results included a tax-exempt gain on bank-owned life insurance of $841,000, which is not a regular or predictable item and is not considered a core income element.  Net interest income for the quarter was up 11.0 percent over the same period last year.  Trust income was higher than last year.   The increase in interest rates at the end of the second quarter negatively impacted the gains and fees from the sale of residential mortgages.  The value of those mortgages held for sale resulted in a loss of approximately $166,000.  Total noninterest expenses were lower this year, primarily because of reduced costs to hold other real estate owned.

During the second quarter of 2013, the loan portfolio grew by $32.1 million.  Deposits grew by $11.1 million.  After one full quarter of operations, West Bank's new Rochester, Minnesota location had $2.7 million of loans outstanding.  The loan pipeline in that market, as well as in eastern and central Iowa, continues to be strong. 

For the first half of 2013, net income was $8.25 million or $0.48 per diluted common share, compared to $8.36 million or $0.48 per diluted common share for the same period in 2012.

As previously announced, the Company repurchased approximately 1.4 million shares of its common stock in early June.  The purchase was financed with a loan that we will pay off over five years.  The low interest rate environment made financing the repurchase a favorable transaction.  Earnings per share will be enhanced going forward because of the repurchase.

The Company filed its quarterly report on Form 10-Q with the Securities and Exchange Commission this morning.  Please refer to that document for a more in-depth discussion of our results.  The Form 10-Q document is available on the Investor Relations section of West Bank's website at www.westbankstrong.com.

The Company will discuss its second quarter 2013 results during a conference call scheduled for this afternoon, Friday, July 26, 2013, at 2:00 p.m. Central Time.  The telephone number for the conference call is 877-317-6016.  A recording of the call will be available until August 6, 2013, at 877-344-7529, pass code: 10022855. 

About West Bancorporation, Inc. (NASDAQ: WTBA)
West Bancorporation, Inc. is headquartered in West Des Moines, Iowa.  Serving Iowans 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 consumers and small- to medium-sized businesses.  West Bank has eight offices in the Des Moines metropolitan area, two offices in Iowa City, one office in Coralville and an office in Rochester, Minnesota.

Certain statements in this press release, other than purely historical information, including estimates, projections, statements relating to our 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, and Section 21E of the Securities Exchange Act of 1934.  Forward-looking statements may appear throughout this press release.  These forward-looking statements are generally identified by the words "believes," "expects," "intends," "anticipates," "projects," "future," "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: interest rate risk; competitive pressures; 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 or regulatory requirements; actions of bank and non-bank competitors; changes in local and national economic conditions; changes in regulatory requirements, limitations, and costs; changes in customers' acceptance of the Company's products and services; 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, except per share data)










CONSOLIDATED STATEMENTS OF CONDITION


June 30, 2013


June 30, 2012

Assets





Cash and due from banks


$

36,024



$

36,555


Short-term investments


5,238



76,303


Securities


388,673



329,597


Loans held for sale


6,753



3,777


Loans


969,109



858,414


Allowance for loan losses


(15,959)



(15,373)


Loans, net


953,150



843,041


Bank-owned life insurance


26,060



25,386


Other real estate owned


7,980



9,241


Other assets


27,768



26,119


Total assets


$

1,451,646



$

1,350,019







Liabilities and Stockholders' Equity





Deposits:





Noninterest-bearing


$

308,189



$

280,398


Interest-bearing:





     Demand


155,025



161,770


     Savings


496,513



423,254


     Time of $100,000 or more


92,528



77,239


     Other time


72,284



84,473


Total deposits


1,124,539



1,027,134


Short-term borrowings


65,671



60,711


Long-term borrowings


132,022



125,619


Other liabilities


7,814



6,523


Stockholders' equity


121,600



130,032


Total liabilities and stockholders' equity


$

1,451,646



$

1,350,019



 

Financial Information (continued) (unaudited)

(in thousands, except per share data)



Three months ended June 30,

Six Months Ended June 30,

CONSOLIDATED INCOME STATEMENTS


2013


2012


2013


2012



Interest income






Loans, including fees



$

11,327



$

11,206



$

22,235



$

22,396

Securities



1,918



1,639



3,519



3,113

Other



16



51



79



93

Total interest income



13,261



12,896



25,833



25,602

Interest expense










Deposits



858



1,271



1,737



2,550

Short-term borrowings



26



29



53



66

Long-term borrowings



844



1,205



1,686



2,417

Total interest expense



1,728



2,505



3,476



5,033

Net interest income



11,533



10,391



22,357



20,569

Provision for loan losses







150



Net interest income after provision for loan losses



11,533



10,391



22,207



20,569

Noninterest income










Service charges on deposit accounts



735



738



1,443



1,468

Debit card usage fees



431



412



824



790

Trust services



238



190



477



394

Gains and fees on sales of residential mortgages



226



581



737



1,328

Increase in cash value of bank-owned life insurance



170



191



330



390

Gain from bank-owned life insurance





841





841

Investment securities impairment losses





(127)





(173)

Realized investment securities gains, net





279





246

Other income



217



241



427



463

Total noninterest income



2,017



3,346



4,238



5,747

Noninterest expense










Salaries and employee benefits



3,986



3,571



7,955



7,207

Occupancy



1,000



875



1,933



1,732

Data processing



500



505



983



1,006

FDIC insurance expense



176



167



365



333

Other real estate owned expense (income)



(15)



906



1



988

Professional fees



333



287



636



579

Consulting fees



112



121



169



307

Other expenses



1,323



1,381



2,619



2,526

Total noninterest expense



7,415



7,813



14,661



14,678

Income before income taxes



6,135



5,924



11,784



11,638

Income taxes



1,837



1,541



3,538



3,278

Net income



$

4,298



$

4,383



$

8,246



$

8,360


 

Financial Information (continued) (unaudited)

(in thousands, except per share data)












PER COMMON SHARE


MARKET INFORMATION (1)




Net Income









Basic and Diluted


Dividends


High


Low

2013









2nd Quarter


$

0.25



$

0.10



$

12.27



$

10.10


1st Quarter


0.23



0.10



11.72



10.46











2012









4th Quarter


$

0.22



$

0.10



$

12.29



$

9.75


3rd Quarter


0.22



0.10



12.35



9.38


2nd Quarter


0.25



0.08



10.22



9.02


1st Quarter


0.23



0.08



10.46



8.71



(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 June 30,


Six Months Ended June 30,

SELECTED FINANCIAL MEASURES


2013


2012


2013


2012

Return on average equity


12.93

%


13.69

%


12.39

%


13.26

%

Return on average assets


1.19

%


1.32

%


1.16

%


1.28

%

Net interest margin


3.51

%


3.44

%


3.44

%


3.47

%

Efficiency ratio


53.15

%


49.31

%


53.50

%


50.52

%















As of June 30,







2013


2012

Texas ratio






10.00

%


13.00

%

Allowance for loan losses ratio






1.65

%


1.79

%

Tangible common equity ratio






8.38

%


9.63

%


 Definitions of ratios:

  • Return on average equity - annualized net income divided by average stockholders' equity.
  • Return on average assets - annualized net income divided by average assets.
  • 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 and net impairment losses) 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.
  • Tangible common equity ratio - common equity less intangible assets divided by tangible assets.

SOURCE West Bancorporation, Inc.



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