SAN RAFAEL, Calif., Jan. 18, 2024 (GLOBE NEWSWIRE) -- Westamerica Bancorporation (NASDAQ:WABC), parent company of Westamerica Bank, generated net income for the fourth quarter 2023 of $39.5 million and diluted earnings per common share ("EPS") of $1.48. Fourth quarter 2023 results include an increase to the book tax provision to reconcile the 2022 income tax provision to the filed 2022 tax returns, which reduced EPS $0.02. Fourth quarter 2023 results compare to third quarter 2023 net income of $41.6 million and EPS of $1.56.

"Westamerica's fourth quarter 2023 results benefited from the Company's valuable low-cost deposit base, of which 48 percent was represented by non-interest bearing checking accounts during the quarter. The annualized cost of funding our loan and bond portfolios was 0.11 percent in the fourth quarter 2023. The Company's customer deposits and shareholders' equity fully funded our interest earning assets during the fourth quarter 2023; the Company did not take in brokered deposits, or borrow from the Federal Reserve Bank or correspondent banks. Operating expenses remained well controlled and nonperforming assets were stable," said Chairman, President and CEO David Payne. "Fourth quarter 2023 results generated an annualized 16.7 percent return on average common equity. Shareholders were paid a $0.44 per common share dividend during the fourth quarter 2023," concluded Payne.

Net interest income on a fully-taxable equivalent (FTE) basis was $69.7 million for the fourth quarter 2023, compared to $72.1 million for the third quarter 2023. The annualized yield earned on loans, bonds and cash for the fourth quarter 2023 was 4.52 percent, up from 4.50 percent for the third quarter 2023. The annualized cost of funding the loan and bond portfolios was 0.11 percent for the fourth quarter 2023, compared to 0.07 percent for the third quarter 2023.

Noninterest income for the fourth quarter 2023 totaled $11.0 million compared to $11.3 million for the third quarter 2023. Third quarter 2023 results include a $278 thousand life insurance gain.

Noninterest expenses for the fourth quarter 2023 were $25.5 million compared to $25.7 million for the third quarter 2023.

The income tax provision for 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

investments@westamerica.com

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, 2022 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 January 18, 2024

WESTAMERICA BANCORPORATION

FINANCIAL HIGHLIGHTS

December 31, 2023

1. Net Income Summary.

(in thousands except per-share amounts)

Q4'2023

Q4'2022

Change

Q3'2023

Net Interest and Fee Income (FTE)

$69,738

$69,155

0.8

$72,092

Provision for Credit Losses

n/m

400

Noninterest Income

10,992

10,463

5.1

11,281

Noninterest Expense

25,517

25,090

1.7

25,650

Income Before Taxes (FTE)

55,213

54,528

1.3

57,323

Income Tax Provision (FTE)

15,745

15,184

3.7

15,722

Net Income

$39,468

$39,344

0.3

$41,601

Average Common Shares Outstanding

26,662

26,912

-0.9

26,648

Diluted Average Common Shares Outstanding

26,664

26,924

-1.0

26,650

Operating Ratios:

Basic Earnings Per Common Share

$1.48

$1.46

1.4

$1.56

Diluted Earnings Per Common Share

1.48

1.46

1.4

1.56

Return On Assets (a)

2.35

2.12

2.41

Return On Common Equity (a)

16.7

18.6

18.3

Net Interest Margin (FTE) (a)

4.41

3.95

4.43

Efficiency Ratio (FTE)

31.6

31.5

30.8

Dividends Paid Per Common Share

$0.44

$0.42

4.8

$0.44

Common Dividend Payout Ratio

12/31'23YTD

12/31'22YTD

Change

Net Interest and Fee Income (FTE)

$281,673

$221,775

27.0

Reversal of Provision for Credit Losses (2)

(1,150

)

n/m

Noninterest Income (1)

43,522

45,121

-3.5

Noninterest Expense

103,216

99,361

3.9

Income Before Taxes (FTE)

223,129

167,535

33.2

Income Tax Provision (FTE)

61,361

45,501

34.9

Net Income

$161,768

$122,034

32.6

Average Common Shares Outstanding

26,703

26,895

-0.7

Diluted Average Common Shares Outstanding

26,706

26,907

-0.7

Operating Ratios:

Basic Earnings Per Common Share

$6.06

$4.54

33.5

Diluted Earnings Per Common Share

6.06

4.54

33.5

Return On Assets

2.35

1.65

Return On Common Equity

18.1

15.2

Net Interest Margin (FTE)

4.37

3.17

Efficiency Ratio (FTE)

31.7

37.2

Dividends Paid Per Common Share

$1.72

$1.68

2.4

Common Dividend Payout Ratio

2. Net Interest Income.

(dollars in thousands)

Q4'2023

Q4'2022

Change

Q3'2023

Interest and Fee Income (FTE)

$71,417

$69,630

2.6

$73,225

Interest Expense

1,679

475

253.5

1,133

Net Interest and Fee Income (FTE)

$69,738

$69,155

0.8

$72,092

Average Earning Assets

$6,251,143

$6,930,584

-9.8

$6,438,411

Average Interest- Bearing Liabilities

2,966,038

3,412,189

-13.1

3,118,632

Yield on Earning Assets (FTE) (a)

4.52

3.98

4.50

Cost of Funds (a)

0.11

0.03

0.07

Net Interest Margin (FTE) (a)

4.41

3.95

4.43

Interest Expense/

Interest-Bearing Liabilities (a)

0.22

0.06

0.14

Net Interest Spread (FTE) (a)

4.30

3.92

4.36

12/31'23YTD

12/31'22YTD

Change

Interest and Fee Income (FTE)

$285,563

$223,700

27.7

Interest Expense

3,890

1,925

102.1

Net Interest and Fee Income (FTE)

$281,673

$221,775

27.0

Average Earning Assets

$6,451,821

$6,992,696

-7.7

Average Interest- Bearing Liabilities

3,128,115

3,506,559

-10.8

Yield on Earning Assets (FTE)

4.43

3.20

Cost of Funds

0.06

0.03

Net Interest Margin (FTE)

4.37

3.17

Interest Expense/

Interest-Bearing Liabilities

0.12

0.05

Net Interest Spread (FTE)

4.31

3.15

3. Loans & Other Earning Assets.

(average volume, dollars in thousands)

Q4'2023

Q4'2022

Change

Q3'2023

Total Assets

$6,665,040

$7,353,270

-9.4

$6,847,691

Total Earning Assets

6,251,143

6,930,584

-9.8

6,438,411

Total Loans

873,635

964,287

-9.4

903,854

Commercial Loans

139,535

173,527

-19.6

151,431

Commercial Real Estate Loans

490,645

492,549

-0.4

493,072

Consumer Loans

243,455

298,211

-18.4

259,351

Total Investment Securities

5,182,557

5,694,280

-9.0

5,247,118

Debt Securities Available for Sale

4,298,396

4,767,459

-9.8

4,353,794

Debt Securities Held to Maturity

884,161

926,821

-4.6

893,324

Total Interest-Bearing Cash

194,951

272,017

-28.3

287,439

Loans/Deposits

15.7

15.2

15.8

12/31'23YTD

12/31'22YTD

Change

Total Assets

$6,871,366

$7,413,008

-7.3

Total Earning Assets

6,451,821

6,992,696

-7.7

Total Loans

912,316

997,964

-8.6

Commercial Loans

153,499

193,481

-20.7

Commercial Real Estate Loans

492,183

504,713

-2.5

Consumer Loans

266,634

299,770

-11.1

Total Investment Securities

5,334,711

5,303,646

0.6

Debt Securities Available for Sale

4,436,003

4,747,969

-6.6

Debt Securities Held to Maturity

898,708

555,677

61.7

Total Interest-Bearing Cash

204,794

691,086

-70.4

Loans/Deposits

15.8

15.6

4. Deposits, Other Interest-Bearing Liabilities & Equity.

(average volume, dollars in thousands)

Q4'2023

Q4'2022

Change

Q3'2023

Total Deposits

$5,573,281

$6,349,401

-12.2

$5,722,817

Noninterest Demand

2,672,170

3,010,806

-11.2

2,721,358

Interest-Bearing Transaction

1,085,864

1,287,304

-15.6

1,149,483

Savings

1,713,803

1,917,370

-10.6

1,741,994

Time greater than $100K

37,970

59,720

-36.4

43,073

Time less than $100K

63,474

74,201

-14.5

66,909

Total Short-Term Borrowings

64,927

73,594

-11.8

117,173

Shareholders' Equity

938,738

837,499

12.1

902,300

Demand Deposits/ Total Deposits

47.9

47.4

47.6

Transaction & Savings Deposits / Total Deposits

98.2

97.9

98.1

12/31'23YTD

12/31'22YTD

Change

Total Deposits

$5,787,361

$6,415,626

-9.8

Noninterest Demand

2,748,544

3,018,350

-8.9

Interest-Bearing Transaction

1,156,684

1,289,956

-10.3

Savings

1,766,225

1,967,902

-10.2

Time greater than $100K

48,076

62,411

-23.0

Time less than $100K

67,832

77,007

-11.9

Total Short-Term Borrowings

89,298

109,283

-18.3

Shareholders' Equity

894,610

802,489

11.5

Demand Deposits/ Total Deposits

47.5

47.0

Transaction & Savings Deposits / Total Deposits

98.0

97.8

5. Interest Yields Earned & Rates Paid.

(dollars in thousands)

Q4'2023

Average

Income/

Yield (a) /

Volume

Expense

Rate (a)

Interest & Fee Income Earned:

Total Earning Assets (FTE)

$6,251,143

$71,417

4.52

Total Loans (FTE)

873,635

11,695

5.31

Commercial Loans (FTE)

139,535

2,503

7.12

Commercial Real Estate Loans

490,645

5,945

4.81

Consumer Loans

243,455

3,247

5.29

Total Investments (FTE)

5,182,557

57,032

4.35

Total Debt Securities Available for Sale (FTE)

4,298,396

48,094

4.42

Corporate Securities

2,129,736

14,687

2.76

Collateralized Loan Obligations

1,508,494

28,041

7.27

Agency Mortgage Backed Securities

264,514

1,627

2.46

Securities of U.S. Government sponsored entities

308,234

2,777

3.60

Obligations of States and Political

Subdivisions (FTE)

73,191

549

3.00

Other Debt Securities Available for Sale (FTE)

14,227

413

11.62

Total Debt Securities Held to Maturity (FTE)

884,161

8,938

4.04

Agency Mortgage Backed Securities

81,789

456

2.23

Corporate Securities

727,579

7,816

4.30

Obligations of States and Political

Subdivisions (FTE)

74,793

666

3.56

Total Interest-Bearing Cash

194,951

2,690

5.40

Interest Expense Paid:

Total Earning Assets

6,251,143

1,679

0.11

Total Interest-Bearing Liabilities

2,966,038

1,679

0.22

Total Interest-Bearing Deposits

2,901,111

1,635

0.22

Interest-Bearing Transaction

1,085,864

128

0.05

Savings

1,713,803

1,431

0.33

Time less than $100K

63,474

0.32

Time greater than $100K

37,970

0.26

Total Short-Term Borrowings

64,927

0.26

Net Interest Income and

Margin (FTE)

$69,738

4.41

Q4'2022

Average

Income/

Yield (a) /

Volume

Expense

Rate (a)

Interest & Fee Income Earned:

Total Earning Assets (FTE)

$6,930,584

$69,630

3.98

Total Loans (FTE)

964,287

12,293

5.06

Commercial Loans (FTE)

173,527

2,896

6.62

Commercial Real Estate Loans

492,549

5,812

4.68

Consumer Loans

298,211

3,585

4.77

Total Investments (FTE)

5,694,280

54,770

3.81

Total Debt Securities Available for Sale (FTE)

4,767,459

45,531

3.78

Corporate Securities

2,462,131

17,102

2.78

Collateralized Loan Obligations

1,590,164

22,801

5.61

Agency Mortgage Backed Securities

319,843

1,921

2.40

Securities of U.S. Government sponsored entities

297,710

2,690

3.61

Obligations of States and Political

Subdivisions (FTE)

84,774

644

3.04

Other Debt Securities Available for Sale (FTE)

12,837

373

11.63

Total Debt Securities Held to Maturity (FTE)

926,821

9,239

3.99

Agency Mortgage Backed Securities

109,100

575

2.11

Corporate Securities

720,752

7,815

4.34

Obligations of States and Political

Subdivisions (FTE)

96,969

849

3.50

Total Interest-Bearing Cash

272,017

2,567

3.69

Interest Expense Paid:

Total Earning Assets

6,930,584

475

0.03

Total Interest-Bearing Liabilities

3,412,189

475

0.06

Total Interest-Bearing Deposits

3,338,595

463

0.05

Interest-Bearing Transaction

1,287,304

0.03

Savings

1,917,370

280

0.06

Time less than $100K

74,201

0.27

Time greater than $100K

59,720

0.24

Total Short-Term Borrowings

73,594

0.06

Net Interest Income and

Margin (FTE)

$69,155

3.95

6. Noninterest Income.

(dollars in thousands except per-share amounts)

Q4'2023

Q4'2022

Change

Q3'2023

Service Charges on Deposit Accounts

$3,540

$3,484

1.6

$3,705

Merchant Processing Services

2,863

2,701

6.0

2,911

Debit Card Fees

2,067

1,704

21.3

1,717

Trust Fees

764

754

1.3

783

ATM Processing Fees

622

646

-3.7

640

Other Service Fees

445

416

6.9

463

Financial Services Commissions

103

-35.9

Life Insurance Gains

n/m

278

Other Noninterest Income

624

648

-3.7

706

Total Noninterest Income

$10,992

$10,463

5.1

$11,281

Operating Ratios:

Total Revenue (FTE)

$80,730

$79,618

1.4

$83,373

Noninterest Income/Revenue (FTE)

13.6

13.1

13.5

Service Charges/Avg. Deposits (a)

0.25

0.22

0.26

Total Revenue (FTE) Per Avg.

Common Share (a)

$12.01

$11.74

2.3

$12.41

12/31'23YTD

12/31'22YTD

Change

Service Charges on Deposit Accounts

$14,169

$14,490

-2.2

Merchant Processing Services

11,280

11,623

-3.0

Debit Card Fees (1)

7,185

7,879

-8.8

Trust Fees

3,122

3,216

-2.9

ATM Processing Fees

2,618

2,160

21.2

Other Service Fees

1,765

1,808

-2.4

Financial Services Commissions

336

417

-19.4

Life Insurance Gains

279

930

n/m

Securities Losses

(125

)

n/m

Other Noninterest Income

2,893

2,598

11.4

Total Noninterest Income

$43,522

$45,121

-3.5

Operating Ratios:

Total Revenue (FTE)

$325,195

$266,896

21.8

Noninterest Income/Revenue (FTE)

13.4

16.9

Service Charges/Avg. Deposits

0.24

0.23

Total Revenue (FTE) Per Avg.

Common Share

$12.18

$9.92

22.7

7. Noninterest Expense.

(dollars in thousands)

Q4'2023

Q4'2022

Change

Q3'2023

Salaries & Benefits

$12,156

$11,482

5.9

$11,820

Occupancy and Equipment

4,958

5,218

-5.0

5,065

Outsourced Data Processing

2,441

2,390

2.1

2,473

Limited Partnership Operating Losses

1,440

1,431

0.6

1,440

Professional Fees

389

574

-32.2

401

Courier Service

681

700

-2.7

745

Other Noninterest Expense

3,452

3,295

4.8

3,706

Total Noninterest Expense

$25,517

$25,090

1.7

$25,650

Operating Ratios:

Noninterest Expense/ Avg. Earning Assets (a)

1.62

1.44

1.58

Noninterest Expense/Revenues (FTE)

31.6

31.5

30.8

12/31'23YTD

12/31'22YTD

Change

Salaries & Benefits

$47,871

$46,125

3.8

Occupancy and Equipment

20,520

19,884

3.2

Outsourced Data Processing

9,846

9,684

1.7

Limited Partnership Operating Losses

5,754

5,724

0.5

Professional Fees

1,751

2,628

-33.4

Courier Service

2,652

2,614

1.5

Other Noninterest Expense

14,822

12,702

16.7

Total Noninterest Expense

$103,216

$99,361

3.9

Operating Ratios:

Noninterest Expense/ Avg. Earning Assets

1.60

1.42

Noninterest Expense/Revenues (FTE)

31.7

37.2

8. Allowance for Credit Losses.

(dollars in thousands)

Q4'2023

Q4'2022

Change

Q3'2023

Average Total Loans

$873,635

$964,287

-9.4

$903,854

Beginning of Period Allowance for

Credit Losses on Loans (ACLL)

$17,744

$21,218

-16.4

$18,480

Provision for Credit Losses

n/m

400

Net ACLL Losses

(877

)

(940

)

-6.7

(1,136

)

End of Period ACLL

$16,867

$20,284

-16.8

$17,744

Gross ACLL Recoveries / Gross ACLL Losses

Net ACLL Losses /

Avg. Total Loans (a)

0.40

0.39

0.50

12/31'23YTD

12/31'22YTD

Change

Average Total Loans

$912,316

$997,964

-8.6

Beginning of Period ACLL

$20,284

$23,514

-13.7

(Reversal of) Provision for Credit Losses (2)

(1,150

)

n/m

Net ACLL Losses

(2,267

)

(3,236

)

-29.9

End of Period ACLL

$16,867

$20,284

-16.8

Gross ACLL Recoveries / Gross ACLL Losses

Net ACLL Losses / Avg. Total Loans

0.25

0.32

(dollars in thousands)

12/31/23

12/31/22

Change

9/30/23

Allowance for Credit Losses on Loans

$16,867

$20,284

-16.8

$17,744

Allowance for Credit Losses on

Held to Maturity Securities

-33.0

Total Allowance for Credit Losses

$16,868

$20,285

-16.8

$17,745

Allowance for Unfunded

Credit Commitments

$201

0.0

$201

9. Credit Quality.

(dollars in thousands)

12/31/23

12/31/22

Change

9/30/23

Nonperforming Loans:

Nonperforming Nonaccrual Loans

$401

$146

174.7

$205

Performing Nonaccrual Loans

n/m

Total Nonaccrual Loans

403

146

176.0

209

90+ Days Past Due Accruing Loans

388

628

-38.2

1,029

Total Nonperforming Loans

$791

$774

2.2

$1,238

Total Loans Outstanding

$866,602

$958,488

-9.6

$885,850

Total Assets

6,364,592

6,950,317

-8.4

6,567,288

Loans:

Allowance for Credit Losses on Loans

$16,867

$20,284

-16.8

$17,744

Allowance for Credit Losses on Loans /

Loans

1.95

2.12

2.00

Nonperforming Loans/Total Loans

0.09

0.08

0.14

10. Liquidity.

At December 31, 2023, the Company had $190,314 thousand in cash balances. During the twelve months ending December 31, 2024, the Company expects to receive $265,000 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 December 31, 2023, the Company's debt securities which qualify as collateral for borrowing totaled $3,915,867 thousand. In the ordinary course of business, the Company pledges debt securities as collateral for certain depository customers; at December 31, 2023, the Company had pledged $708,439 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 December 31, 2023, the Company had pledged $996,935 thousand in debt securities at the Federal Reserve Bank. During the Twelve months ended December 31, 2023, the Company's average borrowings from the Federal Reserve Bank and other correspondent banks were $-0- thousand, and at December 31, 2023, the Company's borrowings from the Federal Reserve Bank and other correspondent banks were $-0- thousand. At December 31, 2023, the Company's estimated unpledged collateral qualifying debt securities totaled $1,945,176 thousand. Debt securities eligible as collateral are shown at market value unless otherwise noted.

(in thousands)

12/31/23

Debt Securities Eligible as Collateral:

Corporate Securities

$2,614,904

Collateralized Loan Obligations rated AAA

517,796

Obligations of States and Political Subdivisions

142,178

Agency Mortgage Backed Securities

314,156

Securities of U.S. Government Sponsored Entities (Par Value)

326,833

Total Debt Securities Eligible as Collateral

$3,915,867

Debt Securities Pledged as Collateral:

Deposits by Public Entities

($708,439

)

Short-Term Borrowed Funds (Deposit Sweep)

(259,616

)

Other

(5,701

)

Total Debt Securities Pledged as Collateral

($973,756

)

Debt Securities Pledged at the Federal Reserve Bank

($996,935

)

Estimated Debt Securities Available to Pledge

$1,945,176

11. Capital.

(in thousands, except per-share amounts)

12/31/23

12/31/22

Change

9/30/23

Shareholders' Equity

$772,894

$602,110

28.4

$648,423

Total Assets

6,364,592

6,950,317

-8.4

6,567,288

Shareholders' Equity/

Total Assets

12.14

8.66

9.87

Shareholders' Equity/

Total Loans

89.19

62.82

73.20

Tangible Common Equity Ratio

10.43

7.03

8.17

Common Shares Outstanding

26,671

26,913

-0.9

26,649

Common Equity Per Share

$28.98

$22.37

29.5

$24.33

Market Value Per Common Share

56.41

59.01

-4.4

43.25

(shares in thousands)

Q4'2023

Q4'2022

Change

Q3'2023

Share Repurchase Programs:

Total Shares Repurchased / Canceled

n/m

Average Repurchase Price

n/m

Net Shares Issued

(22

)

n/m

)

12/31'23YTD

12/31'22YTD

Change

Total Shares Repurchased

274

n/m

Average Repurchase Price

$50.11

$58.66

n/m

Net Shares Repurchased (Issued)

242

(47

)

n/m

12. Period-End Balance Sheets.

(unaudited, dollars in thousands)

12/31/23

12/31/22

Change

9/30/23

Assets:

Cash and Due from Banks

$190,314

$294,236

-35.3

$420,550

Debt Securities Available for Sale:

Corporate Securities

1,909,548

2,099,955

-9.1

1,814,424

Collateralized Loan Obligations

1,484,597

1,572,883

-5.6

1,503,078

Agency Mortgage Backed Securities

239,454

286,048

-16.3

239,728

Securities of U.S. Government sponsored

entities

294,919

290,853

1.4

279,364

Obligations of States and Political

Subdivisions

71,283

82,004

-13.1

69,639

Total Debt Securities Available for Sale

3,999,801

4,331,743

-7.7

3,906,233

Debt Securities Held to Maturity:

Agency Mortgage Backed Securities

78,565

104,852

-25.1

84,347

Corporate Securities

728,650

721,854

0.9

726,951

Obligations of States and Political

Subdivisions (3)

71,181

89,207

-20.2

77,558

Total Debt Securities Held to Maturity (3)

878,396

915,913

-4.1

888,856

Loans

866,602

958,488

-9.6

885,850

Allowance For Credit Losses on Loans

(16,867

)

(20,284

)

-16.8

(17,744

)

Total Loans, net

849,735

938,204

-9.4

868,106

Premises and Equipment, net

27,016

28,819

-6.3

27,490

Identifiable Intangibles, net

347

583

-40.4

404

Goodwill

121,673

0.0

121,673

Other Assets

297,310

319,146

-6.8

333,976

Total Assets

$6,364,592

$6,950,317

-8.4

$6,567,288

Liabilities and Shareholders' Equity:

Deposits:

Noninterest-Bearing

$2,605,844

$2,947,277

-11.6

$2,723,403

Interest-Bearing Transaction

1,072,233

1,273,143

-15.8

1,138,220

Savings

1,699,388

1,874,115

-9.3

1,732,849

Time

96,802

130,755

-26.0

104,541

Total Deposits

5,474,267

6,225,290

-12.1

5,699,013

Short-Term Borrowed Funds

58,162

57,792

0.6

115,341

Other Liabilities

59,269

65,125

-9.0

104,511

Total Liabilities

5,591,698

6,348,207

-11.9

5,918,865

Shareholders' Equity:

Common Equity:

Paid-In Capital

473,171

475,121

-0.4

471,862

Accumulated Other

Comprehensive Loss

(190,282

)

(256,105

)

-25.7

(285,709

)

Retained Earnings

490,005

383,094

27.9

462,270

Total Shareholders' Equity

772,894

602,110

28.4

648,423

Total Liabilities and

Shareholders' Equity

$6,364,592

$6,950,317

-8.4

$6,567,288

13. Income Statements.

(unaudited, in thousands except per-share amounts)

Q4'2023

Q4'2022

Change

Q3'2023

Interest & Fee Income:

Loans

$11,606

$12,201

-4.9

$11,925

Equity Securities

174

153

13.7

152

Debt Securities Available for Sale

47,783

45,216

5.7

47,994

Debt Securities Held to Maturity

8,799

9,061

-2.9

8,848

Interest-Bearing Cash

2,690

2,567

4.8

3,929

Total Interest & Fee Income

71,052

69,198

2.7

72,848

Interest Expense:

Transaction Deposits

128

33.3

131

Savings Deposits

1,431

280

411.1

886

Time Deposits

-12.6

Short-Term Borrowed Funds

266.7

Total Interest Expense

1,679

475

253.5

1,133

Net Interest Income

69,373

68,723

0.9

71,715

Provision for Credit Losses

n/m

400

Noninterest Income:

Service Charges on Deposit Accounts

3,540

3,484

1.6

3,705

Merchant Processing Services

2,863

2,701

6.0

2,911

Debit Card Fees

2,067

1,704

21.3

1,717

Trust Fees

764

754

1.3

783

ATM Processing Fees

622

646

-3.7

640

Other Service Fees

445

416

6.9

463

Financial Services Commissions

103

-35.9

Life Insurance Gains

n/m

278

Other Noninterest Income

624

648

-3.7

706

Total Noninterest Income

10,992

10,463

5.1

11,281

Noninterest Expense:

Salaries and Related Benefits

12,156

11,482

5.9

11,820

Occupancy and Equipment

4,958

5,218

-5.0

5,065

Outsourced Data Processing

2,441

2,390

2.1

2,473

Limited Partnership Operating Losses

1,440

1,431

0.6

1,440

Professional Fees

389

574

-32.2

401

Courier Service

681

700

-2.7

745

Other Noninterest Expense

3,452

3,295

4.8

3,706

Total Noninterest Expense

25,517

25,090

1.7

25,650

Income Before Income Taxes

54,848

54,096

1.4

56,946

Income Tax Provision

15,380

14,752

4.3

15,345

Net Income

$39,468

$39,344

0.3

$41,601

Average Common Shares Outstanding

26,662

26,912

-0.9

26,648

Diluted Average Common Shares Outstanding

26,664

26,924

-1.0

26,650

Per Common Share Data:

Basic Earnings

$1.48

$1.46

1.4

$1.56

Diluted Earnings

1.48

1.46

1.4

1.56

Dividends Paid

0.44

0.42

4.8

0.44

12/31'23YTD

12/31'22YTD

Change

Interest & Fee Income:

Loans

$47,116

$49,682

-5.2

Equity Securities

630

537

17.3

Debt Securities Available for Sale

190,039

144,646

31.4

Debt Securities Held to Maturity

35,557

19,101

86.2

Interest-Bearing Cash

10,671

7,790

37.0

Total Interest & Fee Income

284,013

221,756

28.1

Interest Expense:

Transaction Deposits

457

369

23.8

Savings Deposits

2,993

1,141

162.3

Time Deposits

320

336

-4.8

Short-Term Borrowed Funds

120

51.9

Total Interest Expense

3,890

1,925

102.1

Net Interest Income

280,123

219,831

27.4

Reversal of Provision for Credit Losses (2)

(1,150

)

n/m

Noninterest Income:

Service Charges on Deposit Accounts

14,169

14,490

-2.2

Merchant Processing Services

11,280

11,623

-3.0

Debit Card Fees (1)

7,185

7,879

-8.8

Trust Fees

3,122

3,216

-2.9

ATM Processing Fees

2,618

2,160

21.2

Other Service Fees

1,765

1,808

-2.4

Financial Services Commissions

336

417

-19.4

Life Insurance Gains

279

930

n/m

Securities Losses

(125

)

n/m

Other Operating

2,893

2,598

11.4

Total Noninterest Income

43,522

45,121

-3.5

Noninterest Expense:

Salaries and Related Benefits

47,871

46,125

3.8

Occupancy and Equipment

20,520

19,884

3.2

Outsourced Data Processing

9,846

9,684

1.7

Limited Partnership Operating Losses

5,754

5,724

0.5

Professional Fees

1,751

2,628

-33.4

Courier Service

2,652

2,614

1.5

Other Operating

14,822

12,702

16.7

Total Noninterest Expense

103,216

99,361

3.9

Income Before Income Taxes

221,579

165,591

33.8

Income Tax Provision

59,811

43,557

37.3

Net Income

$161,768

$122,034

32.6

Average Common Shares Outstanding

26,703

26,895

-0.7

Diluted Average Common Shares Outstanding

26,706

26,907

-0.7

Per Common Share Data:

Basic Earnings

$6.06

$4.54

33.5

Diluted Earnings

6.06

4.54

33.5

Dividends Paid

1.72

1.68

2.4

Footnotes and Abbreviations:

(1) The Company received a $1.2 million reconciling payment from a payments network in the first quarter 2022.

(2) 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.

(3) 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 December 31, 2023, September 30, 2023 and December 31, 2022.

(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