Question · Q3 2025
Nathan James Race from Piper Sandler inquired about West Bancorporation's loan growth pipeline, particularly in Minnesota, and the strategy for funding mid-single-digit growth through deposit gathering and investment portfolio cash flows. He also asked about future net interest margin tailwinds from fixed-rate loan repricing, deposit beta assumptions for anticipated Fed rate cuts, the expected go-forward effective tax rate, and the company's capital management and deployment priorities.
Answer
Brad Peters, Minnesota Group President, indicated that the loan pipeline in Minnesota is good but more selective, expecting to maintain a mid-single-digit growth pace. CFO Jane Funk stated the objective is to fund growth primarily through deposit gathering and investment portfolio cash flows, with potential short-term wholesale funding. She noted significant repricing opportunities in the fixed-rate loan portfolio (average rate 4.86%) but cautioned that future deposit betas might be less aggressive due to competitive pressures. Funk clarified that the go-forward tax rate is expected to return to 22-23%, and capital deployment priorities focus on organic growth and good loan opportunities.