SAN RAFAEL, Calif., April 18, 2024 (GLOBE NEWSWIRE) — Westamerica Bancorporation (Nasdaq: WABC), parent company of Westamerica Bank, generated net income for the first quarter 2024 of $36.4 million and diluted earnings per common share (“EPS”) of $1.37. First quarter 2024 results compare to fourth quarter 2023 net income of $39.5 million and EPS of $1.48.
“Westamerica’s first quarter 2024 results benefited from the Company’s valuable low-cost deposit base, of which 47 percent was represented by non-interest bearing checking accounts during the quarter; the annualized cost of funding our loan and bond portfolios was 0.20 percent for the first quarter 2024. First quarter 2024 operating expenses remained well controlled at 34 percent of total revenues on a fully-taxable equivalent basis. Our consistent application of conservative loan underwriting practices resulted in relatively stable nonperforming assets totaling $1.5 million,” said Chairman, President and CEO David Payne. “First quarter 2024 results generated an annualized 15.2 percent return on average common equity. Shareholders were paid a $0.44 per common share dividend during the first quarter 2024,” concluded Payne.
Net interest income on a fully-taxable equivalent (FTE) basis was $66.1 million for the first quarter 2024, compared to $69.7 million for the fourth quarter 2023. The annualized yield earned on loans, bonds and cash for the first quarter 2024 was 4.50 percent compared to 4.52 percent for the fourth quarter 2023. The annualized cost of funding the loan and bond portfolios was 0.20 percent for the first quarter 2024 compared to 0.11 percent for the fourth quarter 2023.
The Company provided $300 thousand for the allowance for credit losses on loans in the first quarter 2024. The Allowance for Credit Losses on Loans was $15.9 million at March 31, 2024.
Noninterest income for the first quarter 2024 totaled $10.1 million compared to $11.0 million for the fourth quarter 2023. Debit card fees declined $524 thousand from the fourth quarter 2023 to the first quarter 2024 due to recognition of an annual volume-based incentive in the fourth quarter 2023. Merchant processing services fees declined $356 thousand from the fourth quarter 2023 to the first quarter 2024 due to reduced processing volumes.
Noninterest expenses for the first quarter 2024 were $26.1 million compared to $25.5 million for the fourth quarter 2023. Salaries and related benefits were $430 thousand higher in the first quarter 2024 compared to the fourth quarter 2023 due to seasonally higher payroll taxes, merit increases and higher welfare benefit costs.
The income tax provision (FTE) for the first quarter 2024 was $13.4 million compared to $15.7 million for the fourth quarter 2023. The fourth quarter 2023 includes a $492 thousand increase to reconcile the 2022 income tax provision to the filed 2022 tax returns.
Westamerica Bancorporation’s wholly owned subsidiary Westamerica Bank, operates commercial banking and trust offices throughout Northern and Central California.
Westamerica Bancorporation Web Address: www.westamerica.com
For additional information contact:
Westamerica Bancorporation
1108 Fifth Avenue, San Rafael, CA 94901
Robert A. Thorson – SVP & Chief Financial Officer
707-863-6840
[email protected]
FORWARD-LOOKING INFORMATION:
The following appears in accordance with the Private Securities Litigation Reform Act of 1995:
This press release may contain forward-looking statements about the Company, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.”
Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors — many of which are beyond the Company’s control — could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. The Company’s most recent reports filed with the Securities and Exchange Commission, including the annual report for the year ended December 31, 2023 filed on Form 10-K and quarterly report for the quarter ended September 30, 2023 filed on Form 10-Q, describe some of these factors, including certain credit, interest rate, operational, liquidity and market risks associated with the Company’s business and operations. Other factors described in these reports include changes in business and economic conditions, competition, fiscal and monetary policies, disintermediation, cyber security risks, legislation including the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the Sarbanes-Oxley Act of 2002 and the Gramm-Leach-Bliley Act of 1999, and mergers and acquisitions.
Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward looking statements are made.
| Public Information April 18, 2024 | ||||||||||||||
| WESTAMERICA BANCORPORATION | ||||||||||||||
| FINANCIAL HIGHLIGHTS | ||||||||||||||
| March 31, 2024 | ||||||||||||||
| 1. Net Income Summary. | ||||||||||||||
| (in thousands except per-share amounts) | ||||||||||||||
| % | ||||||||||||||
| Q1’2024 | Q1’2023 | Change | Q4’2023 | |||||||||||
| Net Interest and Fee Income (FTE) | $66,094 | $69,562 | -5.0 | % | $69,738 | |||||||||
| Provision (Reversal | ||||||||||||||
| of Provision) for | ||||||||||||||
| Credit Losses (1) | 300 | (1,550 | ) | n/m | – | |||||||||
| Noninterest Income | 10,097 | 10,549 | -4.3 | % | 10,992 | |||||||||
| Noninterest Expense | 26,099 | 26,210 | -0.4 | % | 25,517 | |||||||||
| Income Before Taxes (FTE) | 49,792 | 55,451 | -10.2 | % | 55,213 | |||||||||
| Income Tax Provision (FTE) | 13,375 | 15,000 | -10.8 | % | 15,745 | |||||||||
| Net Income | $36,417 | $40,451 | -10.0 | % | $39,468 | |||||||||
| Average Common Shares Outstanding | 26,674 | 26,859 | -0.7 | % | 26,662 | |||||||||
| Diluted Average Common Shares Outstanding | 26,675 | 26,866 | -0.7 | % | 26,664 | |||||||||
| Operating Ratios: | ||||||||||||||
| Basic Earnings Per Common Share | $1.37 | $1.51 | -9.3 | % | $1.48 | |||||||||
| Diluted Earnings Per Common Share | 1.37 | 1.51 | -9.3 | % | 1.48 | |||||||||
| Return On Assets (a) | 2.24 | % | 2.31 | % | 2.35 | % | ||||||||
| Return On Common Equity (a) | 15.2 | % | 19.1 | % | 16.7 | % | ||||||||
| Net Interest Margin (FTE) (a) | 4.30 | % | 4.18 | % | 4.41 | % | ||||||||
| Efficiency Ratio (FTE) | 34.3 | % | 32.7 | % | 31.6 | % | ||||||||
| Dividends Paid Per Common Share | $0.44 | $0.42 | 4.8 | % | $0.44 | |||||||||
| Common Dividend Payout Ratio | 32 | % | 28 | % | 30 | % | ||||||||
| 2. Net Interest Income. | ||||||||||||||
| (dollars in thousands) | ||||||||||||||
| % | ||||||||||||||
| Q1’2024 | Q1’2023 | Change | Q4’2023 | |||||||||||
| Interest and Fee Income (FTE) | $69,095 | $70,033 | -1.3 | % | $71,417 | |||||||||
| Interest Expense | 3,001 | 471 | 537.2 | % | 1,679 | |||||||||
| Net Interest and Fee Income (FTE) | $66,094 | $69,562 | -5.0 | % | $69,738 | |||||||||
| Average Earning Assets | $6,119,368 | $6,665,156 | -8.2 | % | $6,251,143 | |||||||||
| Average Interest- Bearing Liabilities | 2,955,565 | 3,287,158 | -10.1 | % | 2,966,038 | |||||||||
| Yield on Earning Assets (FTE) (a) | 4.50 | % | 4.21 | % | 4.52 | % | ||||||||
| Cost of Funds (a) | 0.20 | % | 0.03 | % | 0.11 | % | ||||||||
| Net Interest Margin (FTE) (a) | 4.30 | % | 4.18 | % | 4.41 | % | ||||||||
| Interest Expense/ | ||||||||||||||
| Interest-Bearing Liabilities (a) | 0.41 | % | 0.06 | % | 0.22 | % | ||||||||
| Net Interest Spread (FTE) (a) | 4.09 | % | 4.15 | % | 4.30 | % | ||||||||
| 3. Loans & Other Earning Assets. | ||||||||||||||
| (average volume, dollars in thousands) | ||||||||||||||
| % | ||||||||||||||
| Q1’2024 | Q1’2023 | Change | Q4’2023 | |||||||||||
| Total Assets | $6,525,921 | $7,112,317 | -8.2 | % | $6,665,040 | |||||||||
| Total Earning Assets | 6,119,368 | 6,665,156 | -8.2 | % | 6,251,143 | |||||||||
| Total Loans | 853,553 | 945,864 | -9.8 | % | 873,635 | |||||||||
| Commercial Loans | 133,422 | 165,360 | -19.3 | % | 139,535 | |||||||||
| Commercial Real Estate Loans | 488,989 | 493,132 | -0.8 | % | 490,645 | |||||||||
| Consumer Loans | 231,142 | 287,372 | -19.6 | % | 243,455 | |||||||||
| Total Investment Securities | 5,098,539 | 5,548,780 | -8.1 | % | 5,182,557 | |||||||||
| Debt Securities Available for Sale | 4,224,474 | 4,636,098 | -8.9 | % | 4,298,396 | |||||||||
| Debt Securities Held to Maturity | 874,065 | 912,682 | -4.2 | % | 884,161 | |||||||||
| Total Interest-Bearing Cash | 167,276 | 170,512 | -1.9 | % | 194,951 | |||||||||
| Loans/Deposits | 15.9 | % | 15.6 | % | 15.7 | % | ||||||||
| 4. Deposits, Other Interest-Bearing Liabilities & Equity. | ||||||||||||||
| (average volume, dollars in thousands) | ||||||||||||||
| % | ||||||||||||||
| Q1’2024 | Q1’2023 | Change | Q4’2023 | |||||||||||
| Total Deposits | $5,379,060 | $6,061,923 | -11.3 | % | $5,573,281 | |||||||||
| Noninterest Demand | 2,532,381 | 2,851,600 | -11.2 | % | 2,672,170 | |||||||||
| Interest-Bearing Transaction | 1,058,292 | 1,233,439 | -14.2 | % | 1,085,864 | |||||||||
| Savings | 1,691,716 | 1,847,428 | -8.4 | % | 1,713,803 | |||||||||
| Time greater than $100K | 36,135 | 57,630 | -37.3 | % | 37,970 | |||||||||
| Time less than $100K | 60,536 | 71,826 | -15.7 | % | 63,474 | |||||||||
| Total Short-Term Borrowings | 108,886 | 76,835 | 41.7 | % | 64,927 | |||||||||
| Bank Term Funding Program | ||||||||||||||
| Borrowings | 62,582 | – | n/m | – | ||||||||||
| Securities Sold under Repurchase | ||||||||||||||
| Agreements | 46,304 | 76,835 | -39.7 | % | 64,927 | |||||||||
| Shareholders’ Equity | 965,840 | 858,473 | 12.5 | % | 938,738 | |||||||||
| Demand Deposits/ Total Deposits | 47.1 | % | 47.0 | % | 47.9 | % | ||||||||
| Transaction & Savings Deposits / Total Deposits | 98.2 | % | 97.9 | % | 98.2 | % | ||||||||
| 5. Interest Yields Earned & Rates Paid. | ||||||||||||||
| (dollars in thousands) | ||||||||||||||
| Q1’2024 | ||||||||||||||
| Average | Income/ | Yield (a) / | ||||||||||||
| Volume | Expense | Rate (a) | ||||||||||||
| Interest & Fee Income Earned: | ||||||||||||||
| Total Earning Assets (FTE) | $6,119,368 | $69,095 | 4.50 | % | ||||||||||
| Total Loans (FTE) | 853,553 | 11,413 | 5.38 | % | ||||||||||
| Commercial Loans (FTE) | 133,422 | 2,385 | 7.19 | % | ||||||||||
| Commercial Real Estate Loans | 488,989 | 5,911 | 4.86 | % | ||||||||||
| Consumer Loans | 231,142 | 3,117 | 5.42 | % | ||||||||||
| Total Investments (FTE) | 5,098,539 | 55,399 | 4.32 | % | ||||||||||
| Total Debt Securities Available for Sale (FTE) | 4,224,474 | 46,552 | 4.38 | % | ||||||||||
| Corporate Securities | 2,114,861 | 14,555 | 2.75 | % | ||||||||||
| Collateralized Loan Obligations | 1,461,182 | 26,700 | 7.23 | % | ||||||||||
| Agency Mortgage Backed Securities | 252,828 | 1,552 | 2.45 | % | ||||||||||
| Securities of U.S. Government sponsored | ||||||||||||||
| entities | 308,807 | 2,777 | 3.60 | % | ||||||||||
| Obligations of States and Political | ||||||||||||||
| Subdivisions (FTE) | 72,569 | 544 | 3.00 | % | ||||||||||
| Other Debt Securities Available for Sale (FTE) | 14,227 | 424 | 11.92 | % | ||||||||||
| Total Debt Securities Held to Maturity (FTE) | 874,065 | 8,847 | 4.05 | % | ||||||||||
| Agency Mortgage Backed Securities | 76,062 | 427 | 2.25 | % | ||||||||||
| Corporate Securities | 729,273 | 7,816 | 4.29 | % | ||||||||||
| Obligations of States and Political | ||||||||||||||
| Subdivisions (FTE) | 68,730 | 604 | 3.52 | % | ||||||||||
| Total Interest-Bearing Cash | 167,276 | 2,283 | 5.40 | % | ||||||||||
| Interest Expense Paid: | ||||||||||||||
| Total Earning Assets | 6,119,368 | 3,001 | 0.20 | % | ||||||||||
| Total Interest-Bearing Liabilities | 2,955,565 | 3,001 | 0.41 | % | ||||||||||
| Total Interest-Bearing Deposits | 2,846,679 | 2,106 | 0.30 | % | ||||||||||
| Interest-Bearing Transaction | 1,058,292 | 119 | 0.05 | % | ||||||||||
| Savings | 1,691,716 | 1,917 | 0.46 | % | ||||||||||
| Time less than $100K | 60,536 | 49 | 0.33 | % | ||||||||||
| Time greater than $100K | 36,135 | 21 | 0.23 | % | ||||||||||
| Total Short-Term Borrowings | 108,886 | 895 | 3.30 | % | ||||||||||
| Bank Term Funding Program | ||||||||||||||
| Borrowings | 62,582 | 843 | 5.40 | % | ||||||||||
| Securities Sold under Repurchase | ||||||||||||||
| Agreements | 46,304 | 52 | 0.45 | % | ||||||||||
| Net Interest Income and | ||||||||||||||
| Margin (FTE) | $66,094 | 4.30 | % | |||||||||||
| Q1’2023 | ||||||||||||||
| Average | Income/ | Yield (a) / | ||||||||||||
| Volume | Expense | Rate (a) | ||||||||||||
| Interest & Fee Income Earned: | ||||||||||||||
| Total Earning Assets (FTE) | $6,665,156 | $70,033 | 4.21 | % | ||||||||||
| Total Loans (FTE) | 945,864 | 11,834 | 5.07 | % | ||||||||||
| Commercial Loans (FTE) | 165,360 | 2,760 | 6.77 | % | ||||||||||
| Commercial Real Estate Loans | 493,132 | 5,627 | 4.63 | % | ||||||||||
| Consumer Loans | 287,372 | 3,447 | 4.86 | % | ||||||||||
| Total Investments (FTE) | 5,548,780 | 56,257 | 4.06 | % | ||||||||||
| Total Debt Securities Available for Sale (FTE) | 4,636,098 | 47,114 | 4.06 | % | ||||||||||
| Corporate Securities | 2,350,403 | 16,446 | 2.80 | % | ||||||||||
| Collateralized Loan Obligations | 1,577,260 | 25,006 | 6.34 | % | ||||||||||
| Agency Mortgage Backed Securities | 304,863 | 1,865 | 2.45 | % | ||||||||||
| Securities of U.S. Government sponsored | ||||||||||||||
| entities | 306,441 | 2,777 | 3.62 | % | ||||||||||
| Obligations of States and Political | ||||||||||||||
| Subdivisions (FTE) | 83,914 | 637 | 3.04 | % | ||||||||||
| Other Debt Securities Available for Sale (FTE) | 13,217 | 383 | 11.59 | % | ||||||||||
| Total Debt Securities Held to Maturity (FTE) | 912,682 | 9,143 | 4.01 | % | ||||||||||
| Agency Mortgage Backed Securities | 101,911 | 547 | 2.15 | % | ||||||||||
| Corporate Securities | 722,452 | 7,815 | 4.33 | % | ||||||||||
| Obligations of States and Political | ||||||||||||||
| Subdivisions (FTE) | 88,319 | 781 | 3.54 | % | ||||||||||
| Total Interest-Bearing Cash | 170,512 | 1,942 | 4.56 | % | ||||||||||
| Interest Expense Paid: | ||||||||||||||
| Total Earning Assets | 6,665,156 | 471 | 0.03 | % | ||||||||||
| Total Interest-Bearing Liabilities | 3,287,158 | 471 | 0.06 | % | ||||||||||
| Total Interest-Bearing Deposits | 3,210,323 | 458 | 0.06 | % | ||||||||||
| Interest-Bearing Transaction | 1,233,439 | 94 | 0.03 | % | ||||||||||
| Savings | 1,847,428 | 280 | 0.06 | % | ||||||||||
| Time less than $100K | 71,826 | 50 | 0.28 | % | ||||||||||
| Time greater than $100K | 57,630 | 34 | 0.24 | % | ||||||||||
| Total Short-Term Borrowings | 76,835 | 13 | 0.07 | % | ||||||||||
| Securities Sold under Repurchase | ||||||||||||||
| Agreements | 76,835 | 13 | 0.07 | % | ||||||||||
| Net Interest Income and | ||||||||||||||
| Margin (FTE) | $69,562 | 4.18 | % | |||||||||||
| 6. Noninterest Income. | ||||||||||||||
| (dollars in thousands except per-share amounts) | ||||||||||||||
| % | ||||||||||||||
| Q1’2024 | Q1’2023 | Change | Q4’2023 | |||||||||||
| Service Charges on Deposit Accounts | $3,470 | $3,465 | 0.2 | % | $3,540 | |||||||||
| Merchant Processing Services | 2,507 | 2,637 | -4.9 | % | 2,863 | |||||||||
| Debit Card Fees | 1,543 | 1,642 | -6.1 | % | 2,067 | |||||||||
| Trust Fees | 794 | 765 | 3.8 | % | 764 | |||||||||
| ATM Processing Fees | 591 | 654 | -9.6 | % | 622 | |||||||||
| Other Service Fees | 438 | 399 | 9.7 | % | 445 | |||||||||
| Other Noninterest Income | 754 | 987 | -23.6 | % | 691 | |||||||||
| Total Noninterest Income | $10,097 | $10,549 | -4.3 | % | $10,992 | |||||||||
| Operating Ratios: | ||||||||||||||
| Total Revenue (FTE) | $76,191 | $80,111 | -4.9 | % | $80,730 | |||||||||
| Noninterest Income/Revenue (FTE) | 13.3 | % | 13.2 | % | 13.6 | % | ||||||||
| Service Charges/Avg. Deposits (a) | 0.26 | % | 0.23 | % | 0.25 | % | ||||||||
| Total Revenue (FTE) Per Avg. | ||||||||||||||
| Common Share (a) | $11.49 | $12.10 | -5.0 | % | $12.01 | |||||||||
| 7. Noninterest Expense. | ||||||||||||||
| (dollars in thousands) | ||||||||||||||
| % | ||||||||||||||
| Q1’2024 | Q1’2023 | Change | Q4’2023 | |||||||||||
| Salaries & Benefits | $12,586 | $12,067 | 4.3 | % | $12,156 | |||||||||
| Occupancy and Equipment | 5,040 | 5,485 | -8.1 | % | 4,958 | |||||||||
| Outsourced Data Processing | 2,536 | 2,444 | 3.8 | % | 2,441 | |||||||||
| Limited Partnership Operating Losses | 1,440 | 1,434 | 0.4 | % | 1,440 | |||||||||
| Professional Fees | 402 | 476 | -15.5 | % | 389 | |||||||||
| Courier Service | 649 | 615 | 5.5 | % | 681 | |||||||||
| Other Noninterest Expense | 3,446 | 3,689 | -6.6 | % | 3,452 | |||||||||
| Total Noninterest Expense | $26,099 | $26,210 | -0.4 | % | $25,517 | |||||||||
| Operating Ratios: | ||||||||||||||
| Noninterest Expense/ Avg. Earning Assets (a) | 1.72 | % | 1.59 | % | 1.62 | % | ||||||||
| Noninterest Expense/Revenues (FTE) | 34.3 | % | 32.7 | % | 31.6 | % | ||||||||
| 8. Allowance for Credit Losses. | ||||||||||||||
| (dollars in thousands) | ||||||||||||||
| % | ||||||||||||||
| Q1’2024 | Q1’2023 | Change | Q4’2023 | |||||||||||
| Average Total Loans | $853,553 | $945,864 | -9.8 | % | $873,635 | |||||||||
| Beginning of Period Allowance for | ||||||||||||||
| Credit Losses on Loans (ACLL) | $16,867 | $20,284 | -16.8 | % | $17,744 | |||||||||
| Provision (Reversal | ||||||||||||||
| of Provision) for | ||||||||||||||
| Credit Losses (1) | 300 | (1,550 | ) | n/m | – | |||||||||
| Net ACLL (Losses) Recoveries | (1,288 | ) | 775 | -266.2 | % | (877 | ) | |||||||
| End of Period ACLL | $15,879 | $19,509 | -18.6 | % | $16,867 | |||||||||
| Gross ACLL Recoveries / Gross ACLL Losses | 36 | % | 138 | % | 60 | % | ||||||||
| Net ACLL Losses (Recoveries) / | ||||||||||||||
| Avg. Total Loans (a) | 0.61 | % | -0.33 | % | 0.40 | % | ||||||||
| (dollars in thousands) | ||||||||||||||
| % | ||||||||||||||
| 3/31/24 | 3/31/23 | Change | 12/31/23 | |||||||||||
| Allowance for Credit Losses on Loans | $15,879 | $19,509 | -18.6 | % | $16,867 | |||||||||
| Allowance for Credit Losses on | ||||||||||||||
| Held to Maturity Securities | 1 | 1 | 0.0 | % | 1 | |||||||||
| Total Allowance for Credit Losses | $15,880 | $19,510 | -18.6 | % | $16,868 | |||||||||
| Allowance for Unfunded | ||||||||||||||
| Credit Commitments | $201 | $201 | 0.0 | % | $201 | |||||||||
| 9. Credit Quality. | ||||||||||||||
| (dollars in thousands) | ||||||||||||||
| % | ||||||||||||||
| 3/31/24 | 3/31/23 | Change | 12/31/23 | |||||||||||
| Nonperforming Loans: | ||||||||||||||
| Nonperforming Nonaccrual Loans | $957 | $207 | 362.3 | % | $401 | |||||||||
| Performing Nonaccrual Loans | 1 | 7 | -85.7 | % | 2 | |||||||||
| Total Nonaccrual Loans | 958 | 214 | 347.7 | % | 403 | |||||||||
| Accruing Loans 90+ Days Past Due | 525 | 571 | -8.1 | % | 388 | |||||||||
| Total Nonperforming Loans | $1,483 | $785 | 88.9 | % | $791 | |||||||||
| Total Loans Outstanding | $844,677 | $938,628 | -10.0 | % | $866,602 | |||||||||
| Total Assets | 6,464,685 | 6,700,471 | -3.5 | % | 6,364,592 | |||||||||
| Loans: | ||||||||||||||
| Allowance for Credit Losses on Loans | $15,879 | $19,509 | -18.6 | % | $16,867 | |||||||||
| Allowance for Credit Losses on Loans / | ||||||||||||||
| Loans | 1.88 | % | 2.08 | % | 1.95 | % | ||||||||
| Nonperforming Loans/Total Loans | 0.18 | % | 0.08 | % | 0.09 | % | ||||||||
| 10. Liquidity. | ||||||||||||||
| At March 31, 2024, the Company had $434,250 thousand in cash balances. During the twelve months ending March 31, 2025, the Company expects to receive $303,000 thousand in principal payments from its debt securities. If additional operational liquidity is required, the Company can pledge debt securities as collateral for borrowing purposes; at March 31, 2024, the Company’s debt securities which qualify as collateral for borrowing totaled $3,820,309 thousand. In the ordinary course of business, the Company pledges debt securities as collateral for certain depository customers; at March 31, 2024, the Company had pledged $697,486 thousand in debt securities for depository customers. In the ordinary course of business, the Company pledges debt securities as collateral for borrowing from the Federal Reserve Bank; at March 31, 2024, the Company had pledged $863,987 thousand in debt securities at the Federal Reserve Bank. During the Three months ended March 31, 2024, the Company’s average borrowings from the Federal Reserve Bank and other correspondent banks were $62,582 thousand and $-0- thousand, respectively, and at March 31, 2024, the Company’s borrowings from the Federal Reserve Bank and other correspondent banks were $200,000 thousand and $-0- thousand, respectively. At March 31, 2024, the Company’s estimated unpledged collateral qualifying debt securities totaled $1,995,076 thousand. Debt securities eligible as collateral are shown at market value unless otherwise noted. | ||||||||||||||
| (in thousands) |
||||||||||||||
| 3/31/24 | ||||||||||||||
| Debt Securities Eligible as Collateral: | ||||||||||||||
| Corporate Securities | $2,577,324 | |||||||||||||
| Collateralized Loan Obligations rated AAA | 496,419 | |||||||||||||
| Obligations of States and Political Subdivisions | 135,051 | |||||||||||||
| Agency Mortgage Backed Securities | 294,480 | |||||||||||||
| Securities of U.S. Government Sponsored Entities | 117,035 | |||||||||||||
| Securities of U.S. Government Sponsored Entities (Par Value) | 200,000 | |||||||||||||
| Total Debt Securities Eligible as Collateral | $3,820,309 | |||||||||||||
| Debt Securities Pledged as Collateral: | ||||||||||||||
| Deposits by Public Entities | ($697,846 | ) | ||||||||||||
| Securities Sold under Repurchase Agreements | (257,936 | ) | ||||||||||||
| Other | (5,464 | ) | ||||||||||||
| Total Debt Securities Pledged as Collateral | ($961,246 | ) | ||||||||||||
| Debt Securities Pledged at the Federal Reserve Bank | ($863,987 | ) | ||||||||||||
| Estimated Debt Securities Available to Pledge | $1,995,076 | |||||||||||||
| 11. Capital. | ||||||||||||||
| (in thousands, except per-share amounts) | ||||||||||||||
| % | ||||||||||||||
| 3/31/24 | 3/31/23 | Change | 12/31/23 | |||||||||||
| Shareholders’ Equity | $791,691 | $642,925 | 23.1 | % | $772,894 | |||||||||
| Total Assets | 6,464,685 | 6,700,471 | -3.5 | % | 6,364,592 | |||||||||
| Shareholders’ Equity/ | ||||||||||||||
| Total Assets | 12.25 | % | 9.60 | % | 12.14 | % | ||||||||
| Shareholders’ Equity/ | ||||||||||||||
| Total Loans | 93.73 | % | 68.50 | % | 89.19 | % | ||||||||
| Tangible Common Equity Ratio | 10.56 | % | 7.92 | % | 10.43 | % | ||||||||
| Common Shares Outstanding | 26,678 | 26,648 | 0.1 | % | 26,671 | |||||||||
| Common Equity Per Share | $29.68 | $24.13 | 23.0 | % | $28.98 | |||||||||
| Market Value Per Common Share | 48.88 | 44.30 | 10.3 | % | 56.41 | |||||||||
| (shares in thousands) | ||||||||||||||
| % | ||||||||||||||
| Q1’2024 | Q1’2023 | Change | Q4’2023 | |||||||||||
| Share Repurchase Programs: | ||||||||||||||
| Total Shares Repurchased / Canceled | 4 | 274 | n/m | – | ||||||||||
| Average Repurchase Price | $45.58 | $50.11 | n/m | $- | ||||||||||
| Net Shares (Issued) Repurchased | (7 | ) | 265 | n/m | (22 | ) | ||||||||
| 12. Period-End Balance Sheets. | ||||||||||||||
| (unaudited, dollars in thousands) | ||||||||||||||
| % | ||||||||||||||
| 3/31/24 | 3/31/23 | Change | 12/31/23 | |||||||||||
| Assets: | ||||||||||||||
| Cash and Due from Banks | $434,250 | $195,202 | 122.5 | % | $190,314 | |||||||||
| Debt Securities Available for Sale | ||||||||||||||
| Corporate Securities | 1,879,980 | 2,019,240 | -6.9 | % | 1,909,548 | |||||||||
| Collateralized Loan Obligations | 1,420,584 | 1,542,377 | -7.9 | % | 1,484,597 | |||||||||
| Agency Mortgage Backed Securities | 225,564 | 276,078 | -18.3 | % | 239,454 | |||||||||
| Securities of U.S. Government sponsored | ||||||||||||||
| entities | 292,583 | 297,140 | -1.5 | % | 294,919 | |||||||||
| Obligations of States and Political | ||||||||||||||
| Subdivisions | 70,466 | 82,678 | -14.8 | % | 71,283 | |||||||||
| Total Debt Securities Available for Sale | 3,889,177 | 4,217,513 | -7.8 | % | 3,999,801 | |||||||||
| Debt Securities Held to Maturity | ||||||||||||||
| Agency Mortgage Backed Securities | 73,023 | 98,006 | -25.5 | % | 78,565 | |||||||||
| Corporate Securities | 730,350 | 723,553 | 0.9 | % | 728,650 | |||||||||
| Obligations of States and Political | ||||||||||||||
| Subdivisions (2) | 65,352 | 87,760 | -25.5 | % | 71,181 | |||||||||
| Total Debt Securities Held to Maturity (2) | 868,725 | 909,319 | -4.5 | % | 878,396 | |||||||||
| Loans | 844,677 | 938,628 | -10.0 | % | 866,602 | |||||||||
| Allowance For Credit Losses on Loans | (15,879 | ) | (19,509 | ) | -18.6 | % | (16,867 | ) | ||||||
| Total Loans, net | 828,798 | 919,119 | -9.8 | % | 849,735 | |||||||||
| Premises and Equipment, net | 26,458 | 28,331 | -6.6 | % | 27,016 | |||||||||
| Identifiable Intangibles, net | 291 | 523 | -44.5 | % | 347 | |||||||||
| Goodwill | 121,673 | 121,673 | 0.0 | % | 121,673 | |||||||||
| Other Assets | 295,313 | 308,791 | -4.4 | % | 297,310 | |||||||||
| Total Assets | $6,464,685 | $6,700,471 | -3.5 | % | $6,364,592 | |||||||||
| Liabilities and Shareholders’ Equity: | ||||||||||||||
| Deposits: | ||||||||||||||
| Noninterest-Bearing | $2,514,161 | $2,788,992 | -9.9 | % | $2,605,844 | |||||||||
| Interest-Bearing Transaction | 1,066,038 | 1,201,356 | -11.3 | % | 1,072,233 | |||||||||
| Savings | 1,681,921 | 1,783,667 | -5.7 | % | 1,699,388 | |||||||||
| Time | 92,805 | 125,300 | -25.9 | % | 96,802 | |||||||||
| Total Deposits | 5,354,925 | 5,899,315 | -9.2 | % | 5,474,267 | |||||||||
| Bank Term Funding Program | ||||||||||||||
| Borrowings | 200,000 | – | n/m | – | ||||||||||
| Securities Sold under Repurchase | ||||||||||||||
| Agreements | 50,334 | 83,088 | -39.4 | % | 58,162 | |||||||||
| Total Short-Term Borrowed Funds | 250,334 | 83,088 | 201.3 | % | 58,162 | |||||||||
| Other Liabilities | 67,735 | 75,143 | -9.9 | % | 59,269 | |||||||||
| Total Liabilities | 5,672,994 | 6,057,546 | -6.3 | % | 5,591,698 | |||||||||
| Shareholders’ Equity: | ||||||||||||||
| Common Equity: | ||||||||||||||
| Paid-In Capital | 473,989 | 471,159 | 0.6 | % | 473,171 | |||||||||
| Accumulated Other | ||||||||||||||
| Comprehensive Loss | (196,857 | ) | (231,573 | ) | -15.0 | % | (190,282 | ) | ||||||
| Retained Earnings | 514,559 | 403,339 | 27.6 | % | 490,005 | |||||||||
| Total Shareholders’ Equity | 791,691 | 642,925 | 23.1 | % | 772,894 | |||||||||
| Total Liabilities and | ||||||||||||||
| Shareholders’ Equity | $6,464,685 | $6,700,471 | -3.5 | % | $6,364,592 | |||||||||
| 13. Income Statements. | ||||||||||||||
| (unaudited, in thousands except per-share amounts) | ||||||||||||||
| % | ||||||||||||||
| Q1’2024 | Q1’2023 | Change | Q4’2023 | |||||||||||
| Interest & Fee Income: | ||||||||||||||
| Loans | $11,324 | $11,740 | -3.5 | % | $11,606 | |||||||||
| Equity Securities | 174 | 152 | 14.5 | % | 174 | |||||||||
| Debt Securities Available for Sale | 46,243 | 46,810 | -1.2 | % | 47,783 | |||||||||
| Debt Securities Held to Maturity | 8,722 | 8,980 | -2.9 | % | 8,799 | |||||||||
| Interest-Bearing Cash | 2,283 | 1,942 | 17.6 | % | 2,690 | |||||||||
| Total Interest & Fee Income | 68,746 | 69,624 | -1.3 | % | 71,052 | |||||||||
| Interest Expense: | ||||||||||||||
| Transaction Deposits | 119 | 94 | 26.6 | % | 128 | |||||||||
| Savings Deposits | 1,917 | 280 | 584.6 | % | 1,431 | |||||||||
| Time Deposits | 70 | 84 | -16.7 | % | 76 | |||||||||
| Bank Term Funding Program | ||||||||||||||
| Borrowings | 843 | – | n/m | – | ||||||||||
| Securities Sold under Repurchase | ||||||||||||||
| Agreements | 52 | 13 | 306.0 | % | 44 | |||||||||
| Total Interest Expense | 3,001 | 471 | 537.2 | % | 1,679 | |||||||||
| Net Interest Income | 65,745 | 69,153 | -4.9 | % | 69,373 | |||||||||
| Provision (Reversal of Provision) | ||||||||||||||
| for Credit Losses (1) | 300 | (1,550 | ) | n/m | – | |||||||||
| Noninterest Income: | ||||||||||||||
| Service Charges on Deposit Accounts | 3,470 | 3,465 | 0.2 | % | 3,540 | |||||||||
| Merchant Processing Services | 2,507 | 2,637 | -4.9 | % | 2,863 | |||||||||
| Debit Card Fees | 1,543 | 1,642 | -6.1 | % | 2,067 | |||||||||
| Trust Fees | 794 | 765 | 3.8 | % | 764 | |||||||||
| ATM Processing Fees | 591 | 654 | -9.6 | % | 622 | |||||||||
| Other Service Fees | 438 | 399 | 9.7 | % | 445 | |||||||||
| Other Noninterest Income | 754 | 987 | -23.6 | % | 691 | |||||||||
| Total Noninterest Income | 10,097 | 10,549 | -4.3 | % | 10,992 | |||||||||
| Noninterest Expense: | ||||||||||||||
| Salaries and Related Benefits | 12,586 | 12,067 | 4.3 | % | 12,156 | |||||||||
| Occupancy and Equipment | 5,040 | 5,485 | -8.1 | % | 4,958 | |||||||||
| Outsourced Data Processing | 2,536 | 2,444 | 3.8 | % | 2,441 | |||||||||
| Limited Partnership Operating Losses | 1,440 | 1,434 | 0.4 | % | 1,440 | |||||||||
| Professional Fees | 402 | 476 | -15.5 | % | 389 | |||||||||
| Courier Service | 649 | 615 | 5.5 | % | 681 | |||||||||
| Other Noninterest Expense | 3,446 | 3,689 | -6.6 | % | 3,452 | |||||||||
| Total Noninterest Expense | 26,099 | 26,210 | -0.4 | % | 25,517 | |||||||||
| Income Before Income Taxes | 49,443 | 55,042 | -10.2 | % | 54,848 | |||||||||
| Income Tax Provision | 13,026 | 14,591 | -10.7 | % | 15,380 | |||||||||
| Net Income | $36,417 | $40,451 | -10.0 | % | $39,468 | |||||||||
| Average Common Shares Outstanding | 26,674 | 26,859 | -0.7 | % | 26,662 | |||||||||
| Diluted Average Common Shares Outstanding | 26,675 | 26,866 | -0.7 | % | 26,664 | |||||||||
| Per Common Share Data: | ||||||||||||||
| Basic Earnings | $1.37 | $1.51 | -9.3 | % | $1.48 | |||||||||
| Diluted Earnings | 1.37 | 1.51 | -9.3 | % | 1.48 | |||||||||
| Dividends Paid | 0.44 | 0.42 | 4.8 | % | 0.44 | |||||||||
| Footnotes and Abbreviations: | ||||||||||||||
| (1) A recovery of a previously charged off loan in the first quarter 2023 resulted in a $1,550 thousand reversal of the allowance for credit loss provision in the first quarter 2023. | ||||||||||||||
| (2) Debt Securities Held To Maturity and Obligations of States and Political Subdivisions are net of related reserve for expected credit losses of $1 thousand at March 31, 2024, December 31, 2023 and March 31, 2023. | ||||||||||||||
| (FTE) Fully Taxable Equivalent. The Company presents its net interest margin and net interest income on a FTE basis using the current statutory federal tax rate. Management believes the FTE basis is valuable to the reader because the Company’s loan and investment securities portfolios contain a portion of municipal loans and securities that are federally tax exempt. The Company’s tax exempt loans and securities composition may not be similar to that of other banks, therefore in order to reflect the impact of the federally tax exempt loans and securities on the net interest margin and net interest income for comparability with other banks, the Company presents its net interest margin and net interest income on a FTE basis. | ||||||||||||||
| (a) Annualized | ||||||||||||||
Bay Street News
