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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


Date of Report (Date of Earliest Event Reported): July 25, 2024


WEST BANCORPORATION, INC.
(Exact name of registrant as specified in its charter)

Iowa0-4967742-1230603
(State or other jurisdiction of incorporation)(Commission File Number)(I.R.S. Employer Identification No.)


3330 Westown Parkway, West Des Moines, Iowa 50266
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: 515-222-2300


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered or to be registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, no par valueWTBAThe Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o


Item 2.02 Results of Operations and Financial Condition.

On July 25, 2024, West Bancorporation, Inc. (the "Company") issued a press release announcing its second quarter earnings results for the period ended June 30, 2024, and the declaration of a quarterly dividend. A copy of the press release is attached hereto as Exhibit 99.1.

The information furnished in this item of this Form 8-K, and the related exhibit, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act, except as may be expressly set forth by specific reference in such filing.

Item 7.01 Regulation FD Disclosure.

The Company hereby furnishes the Earnings Presentation attached hereto as Exhibit 99.2.

The information furnished in this item of this Form 8-K, and the related exhibit, shall not be deemed "filed" for purposes of Section 18 of the Exchange Act, or incorporated by reference in any filing under the Securities Act, or the Exchange Act, except as may be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.
(d) Exhibits:
Exhibit NumberDescription
99.1
99.2
104Cover Page Interactive Data File (embedded within the Inline XBRL document)



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

West Bancorporation, Inc.
July 25, 2024By:/s/ Jane M. Funk
Name: Jane M. Funk
Title: Executive Vice President, Treasurer and Chief Financial Officer





Exhibit 99.1

wtbalogoedita06a01a01a01a22.jpg


Press Release
 
July 25, 2024
 
FOR IMMEDIATE RELEASE
For more information contact:
Jane Funk, Executive Vice President, Treasurer and Chief Financial Officer (515) 222-5766
 
WEST BANCORPORATION, INC. ANNOUNCES SECOND QUARTER 2024 FINANCIAL RESULTS AND DECLARES QUARTERLY DIVIDEND

West Des Moines, IA - West Bancorporation, Inc. (Nasdaq: WTBA; the “Company”), parent company of West Bank, today reported second quarter 2024 net income of $5.2 million, or $0.31 per diluted common share, compared to first quarter 2024 net income of $5.8 million, or $0.35 per diluted common share, and second quarter 2023 net income of $5.9 million, or $0.35 per diluted common share. On July 24, 2024, the Company’s Board of Directors declared a regular quarterly dividend of $0.25 per common share. The dividend is payable on August 21, 2024, to stockholders of record on August 7, 2024.

David Nelson, President and Chief Executive Officer of the Company, commented, “Our credit quality remains pristine as a result of our disciplined loan growth and credit risk management practices. The ratio of nonperforming assets to total assets remains negligible at 0.01%. In the first half of 2024, we have seen deposits grow, net interest income improve and net interest margin stabilize.”

David Nelson added, “Our efficiency ratio has increased as expected with the costs associated with our new buildings. Our buildings are designed as tools for building strong relationships and facilitating business development. We believe these strategic investments will continue to drive profitable growth similar to the successes we have had in our newer Minnesota offices.”

Second Quarter 2024 Financial Highlights
Quarter Ended June 30, 2024Six Months Ended June 30, 2024
Net income (in thousands)$5,192$11,001
Return on average equity9.50 %10.07 %
Return on average assets0.53 %0.57 %
Efficiency ratio (a non-GAAP measure)67.14 %64.62 %
Nonperforming assets to total assets0.01 %0.01 %

Second Quarter 2024 Compared to First Quarter 2024 Overview

•Loans increased $18.6 million in the second quarter of 2024, or 2.5 percent annualized. The increase is primarily due to the funding of previously committed construction loans.

•No credit loss expense was recorded in either the first or second quarter of 2024.

•The allowance for credit losses to total loans was 0.95 percent at June 30, 2024 and March 31, 2024. Nonaccrual loans at June 30, 2024 consisted of three loans with a total balance of $521 thousand, compared to one loan with a balance of $289 thousand at March 31, 2024.





•Deposits increased $115.9 million, or 3.8 percent, in the second quarter of 2024. Brokered deposits totaled $370.3 million at June 30, 2024, compared to $396.4 million at March 31, 2024, a decrease of $26.1 million. Excluding brokered deposits, deposits increased $142.0 million during the second quarter of 2024. In the second quarter of 2024, a local municipal customer deposited approximately $120.0 million of bond proceeds that are expected to be withdrawn over the next 12-18 months. As of June 30, 2024, estimated uninsured deposits, which exclude deposits in the IntraFi® reciprocal network, brokered deposits and public funds protected by state programs, accounted for approximately 26.3 percent of total deposits.

•Borrowed funds decreased to $525.5 million at June 30, 2024, compared to $639.7 million at March 31, 2024. The decrease was primarily attributable to a decrease of $113.0 million in federal funds purchased and other short-term borrowings as a result of the increase in deposits.
•The efficiency ratio (a non-GAAP measure) was 67.14 percent for the second quarter of 2024, compared to 62.04 percent for the first quarter of 2024. The increase in the efficiency ratio was primarily due to the increase in noninterest expense, partially offset by the increase in net interest income. Salaries and benefits increased primarily due to annual officer compensation increases and compensation related accrual adjustments. Occupancy and equipment increased primarily due to the occupancy costs associated with the Company’s newly constructed headquarters.
•Net interest margin, on a fully tax-equivalent basis (a non-GAAP measure), was 1.86 percent for the second quarter of 2024, compared to 1.88 percent for the first quarter of 2024. Net interest income for the second quarter of 2024 was $17.2 million, compared to $16.8 million for the first quarter of 2024.
•The tangible common equity ratio was 5.65 percent as of both June 30, 2024 and March 31, 2024.

Second Quarter 2024 Compared to Second Quarter 2023 Overview

•Loans increased $191.7 million at June 30, 2024, or 6.8 percent, compared to June 30, 2023. The increase is primarily due to the funding of previously committed construction loans.
•Deposits increased $344.6 million at June 30, 2024, compared to June 30, 2023. Included in deposits were brokered deposits totaling $370.3 million at June 30, 2024, compared to $230.7 million at June 30, 2023. Brokered deposits were used to reduce short-term borrowed funds and to fund loan growth. Excluding brokered deposits, deposits increased $205.0 million, or 7.9 percent, as of June 30, 2024, compared to June 30, 2023. In the second quarter of 2024, a local municipal customer deposited approximately $120.0 million of bond proceeds that are expected to be withdrawn over the next 12-18 months.
•Borrowed funds decreased to $525.5 million at June 30, 2024, compared to $593.9 million at June 30, 2023. The decrease was primarily attributable to a decrease of $98.7 million in federal funds purchased and other short-term borrowings, partially offset by an increase of $35.0 million in FHLB one-month rolling advances hedged with long-term interest rate swaps.
•The efficiency ratio (a non-GAAP measure) was 67.14 percent for the second quarter of 2024, compared to 62.83 percent for the second quarter of 2023. The increase in the efficiency ratio in the second quarter of 2024 compared to the second quarter of 2023 was primarily due to the decrease in net interest income and increase in noninterest expense. Occupancy and equipment increased primarily due to the occupancy costs associated with the Company’s newly constructed headquarters.
•Net interest margin, on a fully tax-equivalent basis (a non-GAAP measure), was 1.86 percent for the second quarter of 2024, compared to 2.02 percent for the second quarter of 2023. Net interest income for the second quarter of 2024 was $17.2 million, compared to $17.3 million for the second quarter of 2023.

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

The Company will discuss its results in a conference call scheduled for 2:00 p.m. Central Time on Thursday, July 25, 2024. The telephone number for the conference call is 800-715-9871. The conference ID for the conference call is 8511345. A recording of the call will be available until August 8, 2024, by dialing 800-770-2030. The conference ID for the replay call is 8511345, followed by the # key.





About West Bancorporation, Inc. (Nasdaq: WTBA)

West Bancorporation, Inc. is headquartered in West Des Moines, Iowa. Serving customers 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 small- to medium-sized businesses and consumers. West Bank has six offices in the Des Moines, Iowa metropolitan area, one office in Coralville, Iowa, and four offices in Minnesota in the cities of Rochester, Owatonna, Mankato and St. Cloud.

Certain statements in this report, other than purely historical information, including estimates, projections, statements relating to the Company’s 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, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements may appear throughout this report. These forward-looking statements are generally identified by the words “believes,” “expects,” “intends,” “anticipates,” “projects,” “future,” “confident,” “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, including the effects of sustained high interest rates by the Federal Reserve; fluctuations in the values of the securities held in our investment portfolio, including as a result of changes in interest rates; competitive pressures, including from non-bank competitors such as “fintech” companies and digital asset service providers; pricing pressures on loans and deposits; our ability to successfully manage liquidity risk; changes in credit and other risks posed by the Company’s loan portfolio, including declines in commercial or residential real estate values or changes in the allowance for credit losses dictated by new market conditions, accounting standards or regulatory requirements; the concentration of large deposits from certain clients who have balances above current FDIC insurance limits; changes in local, national and international economic conditions, including high rates of inflation and possible recession; the effects of recent developments and events in the financial services industry, including the large-scale deposit withdrawals over a short period of time that resulted in recent bank failures; changes in legal and regulatory requirements, limitations and costs including in response to the recent bank failures; changes in customers’ acceptance of the Company’s products and services; the occurrence of fraudulent activity, breaches or failures of our or our third-party partners’ information security controls or cyber-security related incidents, including as a result of sophisticated attacks using artificial intelligence and similar tools; unexpected outcomes of existing or new litigation involving the Company; the monetary, trade and other regulatory policies of the U.S. government; acts of war or terrorism, including the ongoing Israeli-Palestinian conflict and the Russian invasion of Ukraine, widespread disease or pandemics, or other adverse external events; risks related to climate change and the negative impact it may have on our customers and their businesses; changes to U.S. tax laws, regulations and guidance; potential changes in federal policy and at regulatory agencies as a result of the upcoming 2024 presidential election; talent and labor shortages; 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)
As of
CONDENSED BALANCE SHEETSJune 30, 2024March 31, 2024December 31, 2023September 30, 2023June 30, 2023
Assets
Cash and due from banks$27,994 $27,071 $33,245 $18,819 $29,776 
Interest-bearing deposits121,825 120,946 32,112 1,802 1,968 
Securities available for sale, at fair value588,452 605,735 623,919 609,365 645,091 
Federal Home Loan Bank stock, at cost21,065 26,181 22,957 26,691 22,488 
Loans2,998,774 2,980,133 2,927,535 2,849,777 2,807,075 
Allowance for credit losses(28,422)(28,373)(28,342)(28,147)(27,938)
Loans, net2,970,352 2,951,760 2,899,193 2,821,630 2,779,137 
Premises and equipment, net101,965 95,880 86,399 75,675 66,683 
Bank-owned life insurance44,416 44,138 43,864 43,589 43,328 
Other assets89,046 90,981 84,069 104,329 90,084 
Total assets$3,965,115 $3,962,692 $3,825,758 $3,701,900 $3,678,555 
Liabilities and Stockholders’ Equity
Deposits$3,180,922 $3,065,030 $2,973,779 $2,755,529 $2,836,325 
Federal funds purchased and other short-term borrowings85,500 198,500 150,270 261,510 184,150 
Other borrowings439,998 441,183 442,367 443,552 409,736 
Other liabilities34,812 34,223 34,299 37,376 31,218 
Stockholders’ equity223,883 223,756 225,043 203,933 217,126 
Total liabilities and stockholders’ equity$3,965,115 $3,962,692 $3,825,758 $3,701,900 $3,678,555 
For the Quarter Ended
AVERAGE BALANCESJune 30, 2024March 31, 2024December 31, 2023September 30, 2023June 30, 2023
Assets$3,964,109 $3,812,199 $3,706,497 $3,679,541 $3,645,651 
Loans2,994,492 2,949,672 2,857,594 2,813,213 2,783,463 
Deposits3,123,282 2,956,635 2,878,676 2,764,184 2,854,945 
Stockholders’ equity219,771 219,835 201,920 215,230 213,177 



WEST BANCORPORATION, INC. AND SUBSIDIARY
Financial Information (unaudited)
(in thousands)
As of
LOANSJune 30, 2024March 31, 2024December 31, 2023September 30, 2023June 30, 2023
Commercial$526,589 $544,293 $531,594 $529,293 $535,085 
Real estate:
Construction, land and land development496,864 465,247 413,477 399,253 351,461 
1-4 family residential first mortgages92,230 108,065 106,688 89,713 80,998 
Home equity15,264 14,020 14,618 12,429 12,625 
Commercial1,856,301 1,839,580 1,854,510 1,812,816 1,820,718 
Consumer and other15,234 12,844 10,930 10,123 10,289 
3,002,482 2,984,049 2,931,817 2,853,627 2,811,176 
Net unamortized fees and costs(3,708)(3,916)(4,282)(3,850)(4,101)
Total loans$2,998,774 $2,980,133 $2,927,535 $2,849,777 $2,807,075 
Less allowance for credit losses(28,422)(28,373)(28,342)(28,147)(27,938)
Net loans$2,970,352 $2,951,760 $2,899,193 $2,821,630 $2,779,137 
CREDIT QUALITY
Pass$2,994,310 $2,983,618 $2,931,377 $2,853,100 $2,810,640 
Watch7,651 142 144 184 187 
Substandard521 289 296 343 349 
Doubtful— — — — — 
     Total loans$3,002,482 $2,984,049 $2,931,817 $2,853,627 $2,811,176 
DEPOSITS
Noninterest-bearing demand$530,441 $521,377 $548,726 $551,688 $568,029 
Interest-bearing demand443,658 449,946 481,207 417,802 459,030 
Savings and money market - non-brokered1,483,264 1,315,698 1,315,741 1,249,309 1,302,468 
Money market - brokered97,259 119,840 124,335 99,282 114,142 
    Total nonmaturity deposits2,554,622 2,406,861 2,470,009 2,318,081 2,443,669 
Time - non-brokered353,269 381,646 322,694 299,683 276,097 
Time - brokered273,031 276,523 181,076 137,765 116,559 
    Total time deposits626,300 658,169 503,770 437,448 392,656 
    Total deposits$3,180,922 $3,065,030 $2,973,779 $2,755,529 $2,836,325 
BORROWINGS
Federal funds purchased and other short-term borrowings$85,500 $198,500 $150,270 $261,510 $184,150 
Subordinated notes, net79,762 79,697 79,631 79,566 79,500 
Federal Home Loan Bank advances315,000 315,000 315,000 315,000 280,000 
Long-term debt45,236 46,486 47,736 48,986 50,236 
    Total borrowings$525,498 $639,683 $592,637 $705,062 $593,886 
STOCKHOLDERS’ EQUITY
Preferred stock$— $— $— $— $— 
Common stock3,000 3,000 3,000 3,000 3,000 
Additional paid-in capital34,322 33,685 34,197 33,487 32,642 
Retained earnings273,981 272,997 271,369 271,025 269,301 
Accumulated other comprehensive loss(87,420)(85,926)(83,523)(103,579)(87,817)
    Total stockholders’ equity$223,883 $223,756 $225,043 $203,933 $217,126 




WEST BANCORPORATION, INC. AND SUBSIDIARY
Financial Information (unaudited)
(in thousands)
For the Quarter Ended
CONSOLIDATED STATEMENTS OF INCOMEJune 30, 2024March 31, 2024December 31, 2023September 30, 2023June 30, 2023
Interest income:
Loans, including fees$41,700 $40,196 $38,208 $36,756 $35,011 
Securities:
Taxable3,394 3,416 3,521 3,427 3,432 
Tax-exempt808 810 869 880 883 
Interest-bearing deposits1,666 148 85 29 25 
Total interest income47,568 44,570 42,683 41,092 39,351 
Interest expense:
Deposits23,943 21,559 20,024 17,156 16,277 
 Federal funds purchased and other short-term borrowings1,950 2,183 2,024 3,165 2,264 
Subordinated notes1,105 1,108 1,114 1,113 1,109 
Federal Home Loan Bank advances2,718 2,325 2,482 2,329 1,621 
Long-term debt622 645 678 695 739 
Total interest expense30,338 27,820 26,322 24,458 22,010 
Net interest income17,230 16,750 16,361 16,634 17,341 
Credit loss expense (benefit)— — 500 200 — 
Net interest income after credit loss expense (benefit)17,230 16,750 15,861 16,434 17,341 
Noninterest income:
Service charges on deposit accounts462 460 476 463 458 
Debit card usage fees490 458 488 495 511 
Trust services794 776 782 831 749 
 Increase in cash value of bank-owned life insurance278 274 275 262 250 
Loan swap fees— — — 431 — 
Realized securities losses, net— — (431)— — 
Other income322 331 308 340 421 
Total noninterest income2,346 2,299 1,898 2,822 2,389 
Noninterest expense:
Salaries and employee benefits7,169 6,489 6,468 6,696 7,029 
Occupancy and equipment1,852 1,447 1,499 1,359 1,322 
Data processing754 714 723 703 729 
Technology and software731 700 676 573 579 
FDIC insurance631 519 475 439 420 
Professional fees244 257 235 254 287 
Director fees236 199 240 196 251 
Other expenses1,577 1,543 1,845 1,685 1,857 
Total noninterest expense13,194 11,868 12,161 11,905 12,474 
Income before income taxes6,382 7,181 5,598 7,351 7,256 
Income taxes1,190 1,372 1,073 1,445 1,394 
Net income$5,192 $5,809 $4,525 $5,906 $5,862 
Basic earnings per common share$0.31 $0.35 $0.27 $0.35 $0.35 
Diluted earnings per common share$0.31 $0.35 $0.27 $0.35 $0.35 




WEST BANCORPORATION, INC. AND SUBSIDIARY
Financial Information (unaudited)
(in thousands)
For the Six Months Ended
CONSOLIDATED STATEMENTS OF INCOMEJune 30, 2024June 30, 2023
Interest income:
Loans, including fees$81,896 $67,959 
Securities:
Taxable6,810 6,748 
Tax-exempt1,618 1,768 
Interest-bearing deposits1,814 55
Total interest income92,138 76,530 
Interest expense:
Deposits45,502 29,616 
Federal funds purchased and other short-term borrowings4,133 4,343 
Subordinated notes2,213 2,215 
Federal Home Loan Bank advances5,043 2,883 
Long-term debt1,267 1,437 
Total interest expense58,158 40,494 
Net interest income33,980 36,036 
Credit loss expense (benefit)— — 
Net interest income after credit loss expense (benefit)33,980 36,036 
Noninterest income:
Service charges on deposit accounts922 920 
Debit card usage fees948 997 
Trust services1,570 1,455 
Increase in cash value of bank-owned life insurance552 507 
Gain from bank-owned life insurance— 691 
Other income653 776 
Total noninterest income4,645 5,346 
Noninterest expense:
Salaries and employee benefits13,658 13,896 
Occupancy and equipment3,299 2,649 
Data processing1,468 1,364 
Technology and software1,431 1,092 
FDIC insurance1,150 836 
Professional fees501 537 
Director fees435 456 
Other expenses3,120 3,715 
Total noninterest expense25,062 24,545 
Income before income taxes13,563 16,837 
Income taxes2,562 3,131 
Net income$11,001 $13,706 
Basic earnings per common share$0.66 $0.82 
Diluted earnings per common share$0.65 $0.82 






WEST BANCORPORATION, INC. AND SUBSIDIARY
Financial Information (unaudited)
As of and for the Quarter EndedFor the Six Months Ended
COMMON SHARE DATAJune 30, 2024March 31, 2024December 31, 2023September 30, 2023June 30, 2023June 30, 2024June 30, 2023
Earnings per common share (basic)$0.31 $0.35 $0.27 $0.35 $0.35 $0.66 $0.82 
Earnings per common share (diluted)0.31 0.35 0.27 0.35 0.35 0.65 0.82 
Dividends per common share0.25 0.25 0.25 0.25 0.25 0.50 0.50 
Book value per common share(1)
13.30 13.31 13.46 12.19 12.98 
Closing stock price17.90 17.83 21.20 16.31 18.41 
Market price/book value(2)
134.59 %133.96 %157.50 %133.80 %141.83 %
Price earnings ratio(3)
14.36 12.77 19.79 11.75 13.11 
Annualized dividend yield(4)
5.59 %5.61 %4.72 %6.13 %5.43 %
REGULATORY CAPITAL RATIOS
Consolidated:
Total risk-based capital ratio11.85 %11.78 %11.88 %11.96 %12.15 %
Tier 1 risk-based capital ratio9.30 9.23 9.30 9.37 9.51 
Tier 1 leverage capital ratio8.08 8.36 8.50 8.58 8.60 
Common equity tier 1 ratio8.74 8.67 8.74 8.80 8.92 
West Bank:
Total risk-based capital ratio12.66 %12.63 %12.76 %12.89 %13.13 %
Tier 1 risk-based capital ratio11.79 11.76 11.89 12.01 12.24 
Tier 1 leverage capital ratio10.25 10.65 10.86 11.00 11.08 
Common equity tier 1 ratio11.79 11.76 11.89 12.01 12.24 
KEY PERFORMANCE RATIOS AND OTHER METRICS
Return on average assets(5)
0.53 %0.61 %0.48 %0.64 %0.64 %0.57 %0.76 %
Return on average equity(6)
9.50 10.63 8.89 10.89 11.03 10.07 12.90 
Net interest margin(7)(13)
1.86 1.88 1.87 1.91 2.02 1.87 2.12 
Yield on interest-earning assets(8)(13)
5.13 4.99 4.87 4.70 4.57 5.06 4.49 
Cost of interest-bearing liabilities3.83 3.70 3.60 3.38 3.10 3.77 2.94 
Efficiency ratio(9)(13)
67.14 62.04 64.66 60.83 62.83 64.62 58.91 
Nonperforming assets to total assets(10)
0.01 0.01 0.01 0.01 0.01 
ACL ratio(11)
0.95 0.95 0.97 0.99 1.00 
Loans/total assets75.63 75.20 76.52 76.98 76.31 
Loans/total deposits94.27 97.23 98.44 103.42 98.97 
Tangible common equity ratio(12)
5.65 5.65 5.88 5.51 5.90 

(1) Includes accumulated other comprehensive loss.
(2) Closing stock price divided by book value per common share.
(3) Closing stock price divided by annualized earnings per common share (basic).
(4) Annualized dividend divided by period end closing stock price.
(5) Annualized net income divided by average assets.
(6) Annualized net income divided by average stockholders’ equity.
(7) Annualized tax-equivalent net interest income divided by average interest-earning assets.
(8) Annualized tax-equivalent interest income on interest-earning assets divided by average interest-earning assets.
(9) Noninterest expense (excluding other real estate owned expense and write-down of premises) divided by noninterest income (excluding net securities gains/losses and gains/losses on disposition of premises and equipment) plus tax-equivalent net interest income.
(10) Total nonperforming assets divided by total assets.
(11) Allowance for credit losses on loans divided by total loans.    
(12) Common equity less intangible assets (none held) divided by tangible assets.
(13) A non-GAAP measure.






NON-GAAP FINANCIAL MEASURES

This report contains references to financial measures that are not defined in GAAP. Such non-GAAP financial measures include the Company’s presentation of net interest income and net interest margin on a fully taxable equivalent (FTE) basis and the presentation of the efficiency ratio on an adjusted and FTE basis, excluding certain income and expenses. Management believes these non-GAAP financial measures provide useful information to both management and investors to analyze and evaluate the Company’s financial performance. These measures are considered standard measures of comparison within the banking industry. Additionally, management believes providing measures on a FTE basis enhances the comparability of income arising from taxable and nontaxable sources. Limitations associated with non-GAAP financial measures include the risks that persons might disagree as to the appropriateness of items included in these measures and that different companies might calculate these measures differently. These non-GAAP disclosures should not be considered an alternative to the Company’s GAAP results. The following table reconciles the non-GAAP financial measures of net interest income and net interest margin on a fully taxable equivalent basis and efficiency ratio on an adjusted and FTE basis.

 (in thousands)For the Quarter EndedFor the Six Months Ended
June 30, 2024March 31, 2024December 31, 2023September 30, 2023June 30, 2023June 30, 2024June 30, 2023
Reconciliation of net interest income and net interest margin on a FTE basis to GAAP:
Net interest income (GAAP)$17,230 $16,750 $16,361 $16,634 $17,341 $33,980 $36,036 
Tax-equivalent adjustment (1)
55 82 95 113 122 137 283 
Net interest income on a FTE basis (non-GAAP)17,285 16,832 16,456 16,747 17,463 34,117 36,319 
Average interest-earning assets3,731,674 3,595,954 3,487,799 3,478,053 3,461,313 3,663,814 3,448,722 
Net interest margin on a FTE basis (non-GAAP)1.86 %1.88 %1.87 %1.91 %2.02 %1.87 %2.12 %
Reconciliation of efficiency ratio on an adjusted and FTE basis to GAAP:
Net interest income on a FTE basis (non-GAAP)$17,285 $16,832 $16,456 $16,747 $17,463 $34,117 $36,319 
Noninterest income2,346 2,299 1,898 2,822 2,389 4,645 5,346 
Adjustment for realized securities losses, net— — 431 — — — — 
Adjustment for losses on disposal of premises and equipment, net21 — 24 3 2 21 2 
Adjusted income19,652 19,131 18,809 19,572 19,854 38,783 41,667 
Noninterest expense13,194 11,868 12,161 11,905 12,474 25,062 24,545 
Efficiency ratio on an adjusted and FTE basis (non-GAAP) (2)
67.14 %62.04 %64.66 %60.83 %62.83 %64.62 %58.91 %
(1)    Computed on a tax-equivalent basis using a federal income tax rate of 21 percent, adjusted to reflect the effect of the nondeductible interest expense associated with owning tax-exempt securities and loans. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the financial results, as it enhances the comparability of income arising from taxable and nontaxable sources.
(2)     The efficiency ratio expresses noninterest expense as a percent of fully taxable equivalent net interest income and noninterest income, excluding specific noninterest income and expenses. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the Company's financial performance. It is a standard measure of comparison within the banking industry. A lower ratio is more desirable.


1 NASDAQ: WTBA Q2 2024 | Earnings Highlights

 
2 Certain statements in this presentation, other than purely historical information, including estimates, projections, statements relating to the Company’s 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, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act). Forward-looking statements may appear throughout this presentation. These forward-looking statements are generally identified by the words “believes,” “expects,” “intends,” “anticipates,” “projects,” “future,” “confident,” “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, including the effects of sustained high interest rates by the Federal Reserve; fluctuations in the values of the securities held in our investment portfolio, including as a result of changes in interest rates; competitive pressures, including from non-bank competitors such as “fintech” companies and digital asset service providers; pricing pressures on loans and deposits; our ability to successfully manage liquidity risk; changes in credit and other risks posed by the Company’s loan portfolio, including declines in commercial or residential real estate values or changes in the allowance for loan losses dictated by new market conditions, accounting standards or regulatory requirements; the concentration of large deposits from certain clients who have balances above current FDIC insurance limits; changes in local, national and international economic conditions, including high rates of inflation and possible recession; the effects of recent developments and events in the financial services industry, including the large-scale deposit withdrawals over a short period of time that resulted in recent bank failures; changes in legal and regulatory requirements, limitations and costs including in response to the recent bank failures; changes in customers’ acceptance of the Company’s products and services; the occurrence of fraudulent activity, breaches or failures of our or our third-party partners' information security controls or cyber-security related incidents, including as a result of sophisticated attacks using artificial intelligence and similar tools; unexpected outcomes of existing or new litigation involving the Company; the monetary, trade and other regulatory policies of the U.S. government; acts of war or terrorism, including the ongoing Israeli-Palestinian conflict and the Russian invasion of Ukraine, widespread disease or pandemics, or other adverse external events; risks related to climate change and the negative impact it may have on our customers and their business; changes to U.S. tax laws, regulations and guidance; potential changes in federal policy and at regulatory agencies as a result of the upcoming 2024 presidential election; talent and labor shortages; 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. Except as otherwise indicated, this presentation speaks as of the date hereof. The delivery of this presentation shall not, under any circumstances, create any implication that there has been no change in the affairs of West Bancorporation, Inc. after the date hereof. Certain of the information contained herein may be derived from information provided by industry sources. We believe that such information is accurate and that the sources from which it has been obtained are reliable. We cannot guarantee the accuracy of such information, however, and we have not independently verified such information. This presentation contains references to financial measures that are not defined in GAAP. Such non-GAAP financial measures include the Company’s presentation of net interest income and net interest margin on a fully taxable equivalent (FTE) basis and the presentation of the efficiency ratio on an adjusted and FTE basis, excluding certain income and expenses. Management believes these non-GAAP financial measures provide useful information to both management and investors to analyze and evaluate the Company’s financial performance. These measures are considered standard measures of comparison within the banking industry. Additionally, management believes providing measures on a FTE basis enhances the comparability of income arising from taxable and nontaxable sources. Limitations associated with non-GAAP financial measures include the risks that persons might disagree as to the appropriateness of items included in these measures and that different companies might calculate these measures differently. These non-GAAP disclosures should not be considered an alternative to the Company’s GAAP results. This presentation includes reconciliations of non-GAAP financial measures to comparable GAAP financial measures. Disclaimers

 
3 2Q 2024 Financial Highlights (1) Presented on a fully taxable equivalent basis; see Appendix for “Non-GAAP Financial Measures.” $26.26 NASDAQ: WTBA June 28, 2024* Closing Price: $17.90 2Q 2024 Price Range: $15.80 to $18.20 Cash Dividend Per Share Declared On July 24, 2024: $0.25 (payable on August 21, 2024) Annualized Dividend Yield: 5.59% *Last trading day of the quarter. Efficiency Ratio1 67.14% ROA 0.53% NPAs/Assets 0.01% ROE 9.50% NIM1 1.86% Diluted EPS $0.31 Net Income $5.2 million

 
4 • West Bancorporation, Inc. (the “Company”) is a publicly-traded, financial holding company (NASDAQ: WTBA) established in 1984 whose sole subsidiary is West Bank, founded in 1893. • West Bank is headquartered in West Des Moines, Iowa and has 11 branches and commercial banking offices serving the greater Des Moines, Iowa area; eastern Iowa, which includes Iowa City and Coralville, Iowa; and southern Minnesota, which includes Rochester, Owatonna, Mankato, and St. Cloud, Minnesota. • The Company is a reliable, dividend paying community bank with $3.9 billion in assets focused on commercial banking. Our mission is to build strong relationships, build strong communities, and build upon our strong reputation to ensure our clients receive exceptional care, our communities receive outstanding support, and the loyalty of our employees and stockholders is rewarded. Company Profile and Mission • One of the Company's key competitive advantages is its client-centric approach to delivering strategic financial solutions to businesses, driven by the establishment of deep customer relationships and extensive experience in its markets. • First and foremost a community bank, West Bank has built a strong reputation for being responsive to local needs. West Bank employees place a high priority on community involvement, lending their time and talents to a long list of civic and community projects. • West Bank strives to be best at all things that are most important to someone running their own business. Mission

 
5 Experienced Executive Leadership David D. Nelson Director/Chief Executive Officer/President Joined West Bank in 2010 Years in Banking: 41 Prior to joining the Company Mr. Nelson was the President of Southeast Minnesota Business Banking and President of Wells Fargo Bank Rochester in Rochester, Minnesota. Harlee N. Olafson Chief Risk Officer/Executive Vice President Joined West Bank in 2010 Years in Banking: 46 Prior to joining the Company Mr. Olafson was the President of Southwest Minnesota Business Banking and President of Wells Fargo Bank Mankato in Mankato, Minnesota. Bradley P. Peters Executive Vice President West Bank Minnesota Group President Joined West Bank in 2019 Years in Banking: 39 Prior to joining the Company Mr. Peters was the Executive Vice President of Bremer Bank in Minnesota where he was responsible for new market expansion. Jane M. Funk Chief Financial Officer Executive Vice President/Treasurer Joined West Bank in 2014 Years in Banking & Public Accounting: 34 Ms. Funk has extensive experience in the community banking industry and public accounting. Brad L. Winterbottom Executive Vice President West Bank President Joined West Bank in 1992 Years in Banking: 44 Mr. Winterbottom has extensive experience in commercial lending and loan portfolio administration and knowledge of the Iowa business community. Todd A. Mather West Bank Chief Credit Officer Joined West Bank in 2019 Years in Banking: 28 Prior to joining West Bank, Mr. Mather spent 8 years at Bremer Bank in Minnesota as a Senior Credit Director and Group Senior Credit Manager.

 
6 Conservative Organic Growth with Successful Lift-Out Strategies David Nelson joins West Bank as CEO. Entered the Rochester, Minnesota market by hiring experienced bankers who had existing strong relationships with local business owners and creating an advisory community board made up of local business owners and leaders. Constructed a bank office building in Rochester, Minnesota. Crossed $2 billion in total assets. Expanded into St. Cloud, Mankato, and Owatonna, Minnesota with the same lift- out strategy used in Rochester, Minnesota. Crossed $3 billion in total assets. Opened a newly constructed bank office building in St. Cloud, Minnesota. Opened a newly constructed bank office building in Mankato, Minnesota and began construction on a bank office building in Owatonna, Minnesota. Opened new corporate headquarters building in West Des Moines, Iowa in April 2024. After being in the same leased space for fifty years, the new building consolidates our operations under one roof, and provides space for future growth and enhanced business development opportunities. 2010 2013 2016 2018 2019 2020 2022 2023 2024

 
7 Company Highlights – Commitment to Excellence West Bancorporation is a high performing company in U.S. community banking, well-versed in providing commercial banking services, including loans and lines of credit and all types of deposit services, to small- and medium-sized businesses in its Iowa and Minnesota markets. Established • A 132 year presence in the Des Moines, Iowa metropolitan area and is West Des Moines' oldest business of any type. • Long track record of growth and stability coupled with attractive financial returns and dividend yield. • Simple and consistent business model with a conservative operating philosophy and expense management controls. Strategy • Disciplined organic growth strategy with a track record of successful lift-out strategies. • Business model highlighted by focus on risk management and consistent execution. • Superior talent with business expertise in building relationships. Community Service & Philanthropy • In 2023, our employees volunteered over 8,000 hours of community service. • In 2023, the West Bancorporation Foundation and West Bank provided over $730,000 in total philanthropic contributions to more than 225 organizations.

 
8 Company Highlights – Commitment to Excellence West Bank is a commercially-focused financial institution operating in high quality markets in Iowa and Minnesota led by a deep and experienced management team with skills developed internally and with other large regional banking institutions. Credit Culture Risk Management • Strict credit risk management with robust processes and experienced credit personnel. • 30 high quality commercial bankers with an average of 20 years of commercial banking experience. • Centralized committee structure that is agile and responsive to customer needs and an organizational structure that provides deep support of credit and administrative functions. • We are a local lender to local customers. We live where we lend. • Commercial real estate stress testing is completed quarterly. • No exposure to cryptocurrency companies or assets. • No commercial real estate office exposure in major metropolitan downtown areas outside of Iowa. Asset Quality • Proven credit culture with a history of strong asset quality. • Classified and watch list loan balance was 0.27% of the loan portfolio at June 30, 2024. • Nonperforming assets at June 30, 2024 totaled $521 thousand, or 0.01% of total assets.

 
9 $2,783 $2,813 $2,858 $2,950 $2,994 $2,980 $2,999 2Q23 3Q23 4Q23 1Q24 2Q24 1Q24 2Q24 Loans • Loans increased $18.6 million in Q2 2024, primarily due to the funding of previously committed construction loans. • Quarterly average loans increased $44.8 million compared to Q1 2024. • Commercial real estate loans are diversified among various sectors, including hotels, warehouses, medical, senior living, mixed use and office. • Commercial office lending makes up less than 6.1% of the total loan portfolio, with only 1.2% located in the Des Moines metropolitan downtown area. • Loan yields increased 11 bps in Q2 2024 compared to Q1 2024 as loan originations and renewals priced at higher prevailing market rates compared to current portfolio rates. • 34% of the loan portfolio consists of variable-rate loans. Quarterly Highlights C & I, 18% CRE - NOO, 36% CRE - OO, 12% Multi Family, 13% 1-4 Family, 3% C & D, 17% Consumer and other, 1% Loan Mix as of 6/30/24 5.05% 5.19% 5.31% 5.49% 5.60% Loans ($ in millions) Average Balances Period End Loan Yield %

 
10 Deposits • Total deposits increased $115.9 million in Q2 2024. • Brokered deposits decreased $26.1 million in Q2 2024. • West Bank participates in the IntraFi® ICS and CDARS reciprocal deposit network which enables depositors to receive FDIC insurance coverage on deposits otherwise exceeding the maximum insurable amount. • Estimated uninsured deposits, excluding deposits in the IntraFi® reciprocal deposit network, brokered deposits and public funds protected by state programs, were approximately 26.3% of total deposits at the end of Q2. • Deposit costs increased 13 bps in Q2 2024 compared to Q1 2024. • Deposit costs have continued to increase in response to sustained high short term market rates and pricing competition from other financial institutions and brokerage firms. Quarterly Highlights $2,855 $2,764 $2,879 $2,957 $3,123 $3,065 $3,181 2Q23 3Q23 4Q23 1Q24 2Q24 1Q24 2Q24 Average Balances Deposit Cost % Period End Deposits ($ in millions) 2.85% 3.10% 3.43% 3.57% 3.70% Brokered Deposits, 12% Noninterest- Bearing, 17% Interest-Bearing Demand, 14% Savings and Money Market, 46% Time Deposits, 11% Deposit Mix as of 6/30/24

 
11 Funding and Liquidity Cost of liability funding ($ in thousands) Cash and cash equivalents $ 149,819 Unpledged securities 156,561 FHLB borrowing availability 524,974 Unsecured lines of credit availability 75,000 Federal Reserve discount window availability 71,550 Total as of 6/30/2024 $ 977,904 $3,411 $3,443 $3,463 $3,555 $3,703 $564 $572 $561 $530 $521 $2,291 $2,192 $2,318 $2,427 $2,602 $556 $679 $584 $598 $580 Average Noninterest-Bearing Deposits Average Interest Bearing Deposits Average Borrowings 2Q23 3Q23 4Q23 1Q24 2Q24 3.10% 3.38% 3.60% 3.70% 3.83% Overall Funding Costs Sources of Liquidity West Bank also maintains master brokered deposit agreements with brokerage firms and access to one-way buy options through the IntraFi® deposit network. ($ in millions)

 
12 $3 $108 2Q23 3Q23 4Q23 1Q24 2Q24 Credit Quality $0.3 $0.3 $0.3 $0.3 $0.5 2Q23 3Q23 4Q23 1Q24 2Q24 $0.3 $0.3 $0.3 $0.3 $0.5 2Q23 3Q23 4Q23 1Q24 2Q24 $27.9 $28.1 $28.3 $28.3 $28.4 2Q23 3Q23 4Q23 1Q24 2Q24 Net Charge-Offs (Recoveries) ($ in thousands) Substandard Loans ($ in millions) Nonaccrual Loans ($ in millions) Allowance for Credit Losses ($ in millions) 1.00% 0.99% 0.97% 0.95% 0.95% ACL/Loans % $(9) $(31) $(49)

 
13 Net Interest Income (1) Presented on a fully taxable equivalent basis; see Appendix for “Non-GAAP Financial Measures.” $17.3 $16.6 $16.4 $16.8 $17.2 2Q23 3Q23 4Q23 1Q24 2Q24 Net Interest Income ($ in millions) 2.02% 1.91% 1.87% 1.88% 1.86% Net interest margin %(1) Net interest income increased $0.4 million in Q2 2024 compared to Q1 2024 • Loan interest income increased $1.5 million. • Interest income on interest-bearing cash deposits increased $1.5 million. • Deposit interest expense increased $2.4 million. Net interest margin decreased 2 bps in Q2 2024 • Loan yields increased 11 bps in the second quarter of 2024 compared to the first quarter of 2024. • Estimated investment portfolio cash flows for the next 12 months are $49.6 million with a roll-off interest rate of 2.14%.

 
14 8.9% 8.8% 8.7% 8.7% 8.7% 12.2% 12.0% 11.9% 11.8% 11.8% 2Q23 3Q23 4Q23 1Q24 2Q24 8.6% 8.6% 8.5% 8.4% 8.1% 11.1% 11.0% 10.9% 10.7% 10.3% 2Q23 3Q23 4Q23 1Q24 2Q24 9.5% 9.4% 9.3% 9.2% 9.3% 12.2% 12.0% 11.9% 11.8% 11.8% 2Q23 3Q23 4Q23 1Q24 2Q24 12.2% 12.0% 11.9% 11.8% 11.9% 13.1% 12.9% 12.8% 12.6% 12.7% 2Q23 3Q23 4Q23 1Q24 2Q24 Regulatory Capital Ratios Note: Lines depict well-capitalized levels.Company West Bank Total Risk Based Capital Ratio Tier 1 Capital Ratio Common Equity Tier 1 Ratio Tier 1 Leverage Ratio 6.5% 10% 8% 5%

 
15Appendix Appendix Non-GAAP Financial Measures (in thousands) As of and for the Quarter Ended June 30, 2024 March 31, 2024 December 31, 2023 September 30, 2023 June 30, 2023 Reconciliation of net interest income and net interest margin on a FTE basis to GAAP: Net interest income (GAAP) $ 17,230 $ 16,750 $ 16,361 $ 16,634 $ 17,341 Tax-equivalent adjustment (1) 55 82 95 113 122 Net interest income on a FTE basis (non-GAAP) 17,285 16,832 16,456 16,747 17,463 Average interest-earning assets 3,731,674 3,595,954 3,487,799 3,478,053 3,461,313 Net interest margin on a FTE basis (non-GAAP) 1.86 % 1.88 % 1.87 % 1.91 % 2.02 % Reconciliation of efficiency ratio on an adjusted and FTE basis to GAAP: Net interest income on a FTE basis (non-GAAP) $ 17,285 $ 16,832 $ 16,456 $ 16,747 $ 17,463 Noninterest income 2,346 2,299 1,898 2,822 2,389 Adjustment for realized securities losses, net — — 431 — — Adjustment for losses on disposal of premises and equipment, net 21 — 24 3 2 Adjusted income 19,652 19,131 18,809 19,572 19,854 Noninterest expense 13,194 11,868 12,161 11,905 12,474 Efficiency ratio on an adjusted and FTE basis (non- GAAP) (2) 67.14 % 62.04 % 64.66 % 60.83 % 62.83 % (1) Computed on a tax-equivalent basis using a federal income tax rate of 21 percent, adjusted to reflect the effect of the nondeductible interest expense associated with owning tax-exempt securities and loans. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the financial results, as it enhances the comparability of income arising from taxable and nontaxable sources. (2) The efficiency ratio expresses noninterest expense as a percent of fully taxable equivalent net interest income and noninterest income, excluding specific noninterest income and expenses. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the Company's financial performance. It is a standard measure of comparison within the banking industry. A lower ratio is more desirable.

 
16 Third Quarter 2022 Earnings Highlights October 27, 2022 Appendix West Bancorporation, Inc. Board of Directors Back L to R: Douglas Gulling, Sean McMurray, Patrick Donovan and Philip Jason Worth Front L to R: Steven Gaer, Lisa Elming, George Milligan (Chair), Rosemary Parson, David Nelson, James Noyce, Therese Vaughan and Steven Schuler

 
v3.24.2
Cover
Jul. 25, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jul. 25, 2024
Entity Registrant Name WEST BANCORPORATION, INC.
Entity Incorporation, State or Country Code IA
Entity File Number 0-49677
Entity Tax Identification Number 42-1230603
Entity Address, Address Line One 3330 Westown Parkway
Entity Address, City or Town West Des Moines
Entity Address, State or Province IA
Entity Address, Postal Zip Code 50266
City Area Code 515-
Local Phone Number 222-2300
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common stock, no par value
Trading Symbol WTBA
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0001166928
Amendment Flag false
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