SAN RAFAEL, Calif., April 19, 2011 (GLOBE NEWSWIRE) -- Westamerica Bancorporation (Nasdaq:WABC), parent company of Westamerica Bank, today reported net income for the first quarter of 2011 of $22.4 million and diluted earnings per common share ("EPS") of $0.77. First quarter 2011 results include expenses related to the integration of the former Sonoma Valley Bank of $393 thousand after tax, equivalent to $0.01 EPS. First quarter 2011 results compare to net income for the first quarter of 2010 of $23.6 million and EPS of $0.80.
"Westamerica remains highly profitable. Our first quarter 2011 net interest margin was 5.35 percent, supported by a relatively low 0.22 percent cost of funding our loan and investment portfolios. Operating expenses remain well contained, declining $200 thousand from the prior quarter. Credit quality improved with nonperforming assets declining $11 million during the first quarter of 2011," said Chairman, President and CEO David Payne. "Westamerica's regulatory capital ratios remain at historically high levels. We are pleased to be delivering a 17 percent return on our shareholders' equity in spite of our robust capital levels," added Payne.
Net interest income on a fully taxable equivalent basis was $55.0 million for the first quarter of 2011, compared to $56.4 million for the fourth quarter of 2010 and to $57.0 million for the first quarter of 2010. The change in net interest income is due to reductions in the net interest margin. Yields on interest-earning assets have declined due to relatively low interest rates prevailing in the market. Economic conditions and deleveraging by businesses and individuals have reduced loan volumes, placing greater reliance on lower-yielding investment securities. Rates on interest-bearing deposits and borrowings have declined to offset some of the decline in asset yields. The first quarter 2011 net interest margin on a fully taxable equivalent basis was 5.35 percent, compared to 5.39 percent and 5.60 percent for the fourth and first quarters of 2010, respectively.
The provision for loan losses was $2.8 million for the first quarter of 2011, unchanged from the fourth and first quarters of 2010. First quarter 2011 net loan losses totaled $4.1 million, or 0.83 percent (annualized) of average originated loans. Comparable net loan loss rates were 1.03 percent and 0.66 percent, respectively, for the fourth and first quarters of 2010. At March 31, 2011, the $34.3 million reserve for loan losses represented 157% of nonperforming originated loans and 206% of annualized first quarter 2011 net loan losses.
Noninterest income for the first quarter of 2011 totaled $14.7 million, compared to $15.1 million in the prior quarter and $15.5 million in the first quarter 2010. Service charges on deposit accounts were lower in both the first quarter 2011 and fourth quarter 2010 compared to the first quarter 2010 due to new overdraft regulations which were effective July 1, 2010.
Noninterest expense for the first quarter of 2011 totaled $31.3 million, compared to $31.5 million in the prior quarter and $32.0 million in the first quarter 2010. First quarter 2011 results include expenses related to the integration of the former Sonoma Valley Bank of $679 thousand, primarily outsourced data processing and personnel costs.
At March 31, 2011, Westamerica Bancorporation's tangible common equity-to-asset ratio was 8.3 percent, Westamerica Bancorporation's total regulatory capital ratio was 15.8 percent, and Westamerica Bank's total regulatory capital ratio was 15.5 percent. At March 31, 2011, the Company's assets totaled $4.9 billion and loans outstanding totaled $2.8 billion. Westamerica Bancorporation, through its wholly owned subsidiary Westamerica Bank, operates commercial banking and trust offices throughout Northern and Central California.
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CONTACT: Westamerica Bancorporation Robert A. Thorson - SVP & Chief Financial Officer 707-863-6840