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WESTAMERICA BANCORPORATION (WABC)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 EPS was $1.12 on net income of $28.3M; total revenue (FTE) was $64.0M, with NIM at 3.80% and the efficiency ratio at 40.3% .
  • Management emphasized low-cost funding (0.26% cost of funds), no provision for credit losses, and strong capital ratios; ROE was 10.9% and ROA 1.86% .
  • Versus estimates (S&P Global), EPS beat by $0.045 and revenue was slightly below by $0.46M; prior quarters also modestly beat EPS with revenue mixed* [GetEstimates].
  • Capital actions continue: dividend of $0.46 declared payable Nov 14, 2025 and 488K shares retired during Q3; share count declined 5.9% YoY .

What Went Well and What Went Wrong

What Went Well

  • Low-cost funding sustained: annualized cost of funds was 0.26%, helping preserve spread despite lower asset yields .
  • Credit remained benign: no provision for credit losses; ACLL ended at $11.9M; nonperforming loans were $2.6M (0.36% of loans) .
  • Operating discipline: efficiency ratio at 40.3% and noninterest expense down 1.9% YoY; CEO highlighted “low-cost operating principles” and capital strength .

What Went Wrong

  • NIM compressed to 3.80% (vs. 3.85% in Q2 and 4.08% in Q3 2024) and net interest & fee income (FTE) fell 13.8% YoY .
  • Noninterest income declined 14.9% YoY, with other noninterest income down sharply; total revenue (FTE) decreased 14.0% YoY .
  • Loan balances decreased (ending loans $741.6M, -11.1% YoY) and NPLs rose vs. prior year, though improved sequentially (from $5.0M) .

Financial Results

MetricQ3 2024Q1 2025Q2 2025Q3 2025
EPS (Diluted) ($)1.31 1.16 1.12 1.12
Net Income ($MM)35.06 31.04 29.07 28.26
Total Revenue (FTE) ($MM)74.39 66.71 64.88 63.997
Net Interest & Loan Fee Income (FTE) ($MM)62.47 56.39 54.56 53.85
Noninterest Income ($MM)11.93 10.32 10.32 10.15
Noninterest Expense ($MM)26.31 25.13 25.53 25.80
NIM (FTE, %)4.08 3.90 3.85 3.80
Efficiency Ratio (FTE, %)35.4 37.7 39.3 40.3
ROA (%)2.16 2.03 1.93 1.86
ROE (%)13.7 11.9 11.2 10.9

Estimates vs Actual (S&P Global):

MetricQ1 2025Q2 2025Q3 2025
EPS Actual ($)1.16*1.12*1.12*
EPS Consensus Mean ($)1.11*1.07*1.075*
EPS Beat/(Miss) ($)+0.05*+0.05*+0.045*
Revenue Actual ($MM)66.86*64.49*63.74*
Revenue Consensus Mean ($MM)66.47*65.80*64.20*
Revenue Beat/(Miss) ($MM)+0.39*-1.31*-0.46*

Values retrieved from S&P Global.
Note: Company reports “Total Revenue (FTE)” of $63.997M for Q3 2025; S&P Global “Revenue” actual appears slightly lower due to definitional differences .*

Noninterest Income Detail:

Component ($000s)Q3 2024Q2 2025Q3 2025
Service Charges on Deposit Accounts3,585 3,368 3,317
Merchant Processing Services2,474 2,687 2,860
Debit Card Fees1,702 1,664 1,603
Trust Fees846 867 895
ATM Processing Fees533 482 483
Other Service Fees454 450 448
Bank Owned Life Insurance Gains202 106 -
Other Noninterest Income2,129 691 635
Total Noninterest Income11,925 10,315 10,151

KPIs and Balance Sheet Highlights:

KPIQ3 2024Q2 2025Q3 2025
Ending Loans ($000)833,967 748,264 741,579
Total Deposits ($000)5,065,050 4,747,535 4,793,179
Demand Deposits / Total Deposits (%)47.6 46.4 45.8
Cost of Funds (%)0.37 0.22 0.26
Yield on Earning Assets (FTE, %)4.45 4.07 4.06
Nonperforming Loans ($000)919 4,964 2,644
NPLs / Loans (%)0.11 0.66 0.36
ACLL ($000)15,318 13,787 11,859
ACLL / Loans (%)1.84 1.84 1.60
Cash Balances ($000)502,945 626,437 659,268
Shares Retired (Qtr, 000s)— 773 488

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Dividend per Share ($)Q4 2025 (payable 11/14/25)$0.46 (ongoing quarterly) $0.46 declared, payable Nov 14, 2025 Maintained
Credit Loss ProvisionQ3 2025No provision in Q2 No provision in Q3 Maintained (benign credit)
Formal Revenue/Expense/Tax GuidanceQ3 2025Not providedNot providedN/A

No formal quantitative forward guidance ranges were issued in Q3 2025 materials .

Earnings Call Themes & Trends

Note: A Q3 2025 earnings call transcript for WABC was not available in our document set; themes are inferred from quarterly releases.

TopicPrevious Mentions (Q1 & Q2 2025)Current Period (Q3 2025)Trend
Funding CostCOF 0.24% in Q1; 0.22% in Q2 COF 0.26% Slight uptick QoQ
Net Interest MarginNIM 3.90% (Q1); 3.85% (Q2) NIM 3.80% Gradual compression
Deposit MixDemand deposits ~46% of total (Q1/Q2) Demand 45.8% Slight decline
Credit QualityNPLs 0.04% of loans (Q1); 0.66% (Q2) NPLs 0.36%; no provision Sequential improvement, YoY higher
Capital & Buybacks361K shares retired (Q1); 773K (Q2) 488K retired; TCE 13.98% Ongoing buybacks
Operating EfficiencyEfficiency ratio 37.7% (Q1); 39.3% (Q2) 40.3% Slightly worse, still low

Management Commentary

  • “Westamerica’s third quarter 2025 results benefited from the Company’s low-cost operating principles… Westamerica operated efficiently, spending 40 percent of its revenue on operating costs… Westamerica’s capital ratios remain at historically high levels exceeding the highest regulatory guidelines.” — David Payne, Chairman, President & CEO .
  • “Second quarter 2025 results generated an annualized 11.2 percent return on average common equity… retired 773 thousand common shares…” — David Payne .
  • “First quarter 2025 results benefited from the Company’s valuable low-cost deposit base… Operating expenses remained well controlled at 38 percent of total revenues…” — David Payne .

Q&A Highlights

Earnings call transcript for Q3 2025 was not available through our document tools; therefore, Q&A themes and specific analyst questions cannot be summarized at this time [SearchDocuments none].

Estimates Context

  • Q3 2025: EPS $1.12 vs S&P Global consensus $1.075, a beat of $0.045; revenue $63.74M vs consensus $64.20M, a slight miss of $0.46M*.
  • Q2 2025: EPS $1.12 vs $1.07, beat $0.05; revenue $64.49M vs $65.80M, miss $1.31M*.
  • Q1 2025: EPS $1.16 vs $1.11, beat $0.05; revenue $66.86M vs $66.47M, beat $0.39M*.

Values retrieved from S&P Global.
Note: Company’s reported “Total Revenue (FTE)” differs slightly from S&P-reported revenue actuals, reflecting definitional differences .*

Key Takeaways for Investors

  • Earnings quality: EPS held at $1.12 despite NIM compression; disciplined cost control (40.3% efficiency) helped protect profitability .
  • Balance sheet conservatism: COF remains very low at 0.26% and liquidity is ample ($659M cash; $1.97B unpledged collateral), supporting flexibility without reliance on wholesale borrowings .
  • Credit benign: no provision in Q3; ACLL 1.60% of loans with NPLs at 0.36%—improved sequentially from Q2 spike .
  • Capital returns: ongoing buybacks (488K shares in Q3) and consistent dividend ($0.46) reduce share count and support per-share metrics .
  • Revenue headwinds: FTE revenue declined YoY on lower asset yields and loans; NIM and noninterest income trends warrant monitoring .
  • Estimate setup: EPS beat in Q3, but revenue slightly missed; analysts may fine-tune topline/margin assumptions given NIM trajectory and deposit mix* [GetEstimates].
  • Near-term focus: watch NIM, deposit mix (demand down modestly), and noninterest income components (other noninterest income volatility) as key drivers of quarterly variability .