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October 18, 2007 - West Bancorporation, Inc. Announces Quarterly Cash Dividend and Results for 3rd Quarter and First Nine Months of 2007

WEST DES MOINES, IA – West Bancorporation, Inc. (Nasdaq: WTBA) (the “Company”), parent company of West Bank and WB Capital Management Inc., reports net income of $4,947,000, or $0.28 per share, for the third quarter of 2007, compared to $4,977,000 or $0.28 per share for the third quarter of 2006. The annualized returns on average equity and average assets were 16.76 percent and 1.51 percent, respectively. For the third quarter of 2006, the annualized returns on average equity and average assets were 18.30 percent and 1.50 percent, respectively.
For the first nine months of 2007, net income was $14,518,000, or $0.83 per share, up from $14,404,000 or $0.82 per share for the first nine months of 2006. The annualized returns on average equity and average assets were 16.81 percent and 1.48 percent, respectively. For the first nine months of 2006, the annualized returns on average equity and average assets were 18.16 percent and 1.48 percent, respectively.
During the third quarter, loans grew by $6.1 million to $943.4 million. West Bank has new loans in process which should result in similar loan growth in the fourth quarter. A year ago, loans totaled $911.9 million.
Loan quality remains good. At September 30, 2007, non-accrual loans totaled $880,000, loans past due 90 days or more and still accruing interest were $93,000, and other real estate owned was $325,000. These three items represent non-performing assets of $1,298,000. During the third quarter, total non-performing assets increased $508,000. Non-accrual loans increased by $275,000, which was attributable to one commercial loan. Other real estate owned increased $171,000, which was the result of foreclosing on two single family homes. A year ago, non-performing assets totaled $6,281,000. The allowance for loan losses as a percent of total loans was 0.94 percent as of September 30, 2007, compared to 0.90 percent a year earlier. Non-performing assets as a percentage of loans at September 30, 2007, were 0.14 percent, compared to 0.69 percent a year ago.
There has been a significant amount of publicity in the national media regarding sub-prime single family mortgages and increases in foreclosure rates. West Bank has not and does not originate sub-prime single family mortgages. In addition, West Bank does not directly invest in sub-prime mortgages in its investment portfolio and the amount, if any, of sub prime mortgages securing mortgage backed securities owned by the bank is not a material amount of its investment portfolio. While the foreclosure rate in Iowa has been increasing, the Company does not expect this to have a material impact on its operations. For several years, the majority of mortgage loans originated by West Bank have been sold in the secondary market and not retained on the Company’s books. West Bank has owned a portfolio of single family loans for several years that may from time to time result in foreclosures, but the number of future foreclosures is not expected to be material.
West Bank does have a significant portion of its loan portfolio in construction and commercial real estate loans. The slowdown in the real estate market has resulted in fewer new loans in these categories. West Bank believes these loans are adequately secured, but it is difficult to predict the consequences from any further downturn in the real estate market.
On October 17, 2007, the Company’s Board of Directors declared a regular quarterly cash dividend of $0.16 per share. The dividend is payable on November 14, 2007, to shareholders of record on October 29, 2007. As of October 17, 2007, there were 17,536,682 shares of common stock outstanding.
The Company will discuss its results for the third quarter and first nine months of 2007 during a conference call scheduled for 2:00 pm Central Time on Thursday, October 18, 2007. The telephone number for the conference call is 877-407-0778. A recording of the call will be available until October 23, 2007, by dialing 877-660-6853, account # 286, conference ID # 226744.
West Bancorporation, Inc. is headquartered in West Des Moines, Iowa. Serving Iowans 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 consumers and small to medium sized businesses. The Bank has two full-service offices in Iowa City, one full- service office in Coralville, and seven full-service offices in the greater Des Moines area. WB Capital Management Inc., a wholly owned subsidiary of West Bancorporation, Inc., has offices in West Des Moines and Coralville, and provides portfolio management services to individuals, retirement plans, corporations, public funds, mutual funds, foundations, endowments, and high net worth individuals.
The information contained in this Press Release may contain forward- looking statements about the Company’s growth and acquisition strategies, new products and services, and future financial performance, including earnings and dividends per share, return on average assets, return on average equity, efficiency ratio, and capital ratio. Certain statements in this news release constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking information is based upon certain underlying assumptions, risks and uncertainties. Because of the possibility of change in the underlying assumptions, actual results could differ materially from these forward-looking statements. Risks and uncertainties that may affect future results include: competitive pressures, pricing pressures on loans and deposits, actions of bank and non-bank competitors, changes in local and national economic conditions, changes in regulatory requirements, actions of the Securities and Exchange Commission and/or the Federal Reserve Board, and customers’ acceptance of the Company’s products and services. The Company undertakes no obligation to revise or update such statements to reflect current events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
WEST BANCORPORATION, INC. AND
SUBSIDIARIES
Financial Information
(unaudited)
(in thousands, except per share data)
September 30, September 30,
CONSOLIDATED STATEMENTS OF CONDITION 2007 2006
Assets
Cash and due from banks $28,857 $27,088
Short-term investments 5,957 3,478
Securities 250,436 271,599
Loans 943,393 911,931
Allowance for loan losses (8,905) (8,178)
Loans, net 934,488 903,753
Goodwill and other intangible assets 27,275 26,453
Bank-owned life insurance 23,617 22,736
Other assets 26,598 26,512
Total assets $1,297,228 $1,281,619
Liabilities and Stockholders’ Equity
Deposits:
Noninterest-bearing $177,991 $196,541
Interest-bearing
Demand 69,365 48,135
Savings 219,742 231,086
Time 391,120 509,849
Total deposits 858,218 985,611
Short-term borrowings 181,746 88,632
Long-term borrowings 123,869 86,884
Other liabilities 13,350 9,486
Stockholders’ equity 120,045 111,006
Total liabilities and stockholders’
equity $1,297,228 $1,281,619
PER COMMON SHARE MARKET INFORMATION (1)
Net Income Dividends High Low
2007
1st quarter $0.25 $0.160 $18.25 $14.29
2nd quarter 0.29 0.160 16.36 14.17
3rd quarter 0.28 0.160 16.19 14.68
2006
1st quarter 0.26 0.152 18.95 16.67
2nd quarter 0.28 0.152 19.98 15.24
3rd quarter 0.28 0.160 18.10 15.61
4th quarter 0.29 0.160 19.02 16.69
(1) The prices shown are the high and low sale prices for the Company’s
common stock, which trades on the NASDAQ Global Market, under the
symbol WTBA. The market quotations, reported by NASDAQ, do not
include retail markup, markdown or commissions.
WEST BANCORPORATION, INC. AND
SUBSIDIARIES
Financial Information (continued) (unaudited)
(in thousands, except per share data)
Three months ended Nine months ended
September 30, September 30,
CONSOLIDATED STATEMENTS OF
OPERATION 2007 2006 2007 2006
Interest income
Loans $17,730 $17,505 $52,766 $50,004
Securities 2,784 2,963 8,454 8,779
Other 122 288 682 633
Total interest income 20,636 20,756 61,902 59,416
Interest expense
Deposits 7,651 8,953 22,906 23,710
Short-term borrowings 1,741 863 5,267 2,647
Long-term borrowings 1,591 1,218 4,977 3,957
Total interest expense 10,983 11,034 33,150 30,314
Net interest income 9,653 9,722 28,752 29,102
Provision for loan losses 500 450 1,150 1,350
Net interest income after
provision for loan losses 9,153 9,272 27,602 27,752
Noninterest income
Service charges on deposit
accounts 1,244 1,371 3,583 3,492
Trust services 195 208 564 571
Investment advisory fees 1,968 2,003 5,970 6,364
Increase in cash value of
bank-owned life insurance 226 215 661 637
Net realized gains (losses)
from sales of securities
held for sale 11 (3) 2 (147)
Other income 405 356 1,174 1,074
Total noninterest income 4,049 4,150 11,954 11,991
Noninterest expense
Salaries and employee
benefits 3,354 3,323 10,325 10,490
Occupancy expense 879 826 2,710 2,548
Data processing expense 472 448 1,412 1,433
Other expense 1,431 1,500 4,051 4,120
Total noninterest expense 6,136 6,097 18,498 18,591
Income before income taxes 7,066 7,325 21,058 21,152
Income taxes 2,119 2,348 6,540 6,748
Net income $4,947 $4,977 $14,518 $14,404
PERFORMANCE HIGHLIGHTS
Return on average equity 16.76% 18.30% 16.81% 18.16%
Return on average assets 1.51% 1.50% 1.48% 1.48%
Net interest margin 3.32% 3.29% 3.30% 3.36%
Efficiency ratio 43.60% 42.60% 44.17% 43.70%
SOURCE West Bancorporation, Inc.
Contact: Doug Gulling, Executive Vice President and Chief Financial Officer of West Bancorporation, Inc., (515)222-2309