SAN RAFAEL, Calif., April 20, 2017 (GLOBE NEWSWIRE) -- Westamerica Bancorporation (Nasdaq:WABC), parent company of Westamerica Bank, generated net income for the first quarter 2017 of $15.0 million and diluted earnings per common share ("EPS") of $0.57. First quarter 2017 results reflect the Company’s prospective adoption of a new accounting standard related to the recognition of tax benefits derived from share based compensation; first quarter 2017 EPS measured $0.02 higher than would have been measured under accounting standards applied in 2016. First quarter 2017 results compare to fourth quarter 2016 net income of $14.5 million and EPS of $0.56, and first quarter 2016 net income of $14.2 million and EPS of $0.56.

"Average loan volumes were stable in the first quarter 2017 compared to the prior quarter, and our annualized fully tax equivalent net interest margin was 3.14 percent for the first quarter 2017. Credit quality improved with non-performing assets declining $3 million during the first quarter to total $9 million at March 31, 2017. Our noninterest expenses were $24.6 million in the first quarter 2017, a reduction of $1.3 million compared to the first quarter 2016,” said Chairman, President and CEO David Payne. “Westamerica generated an annualized 10 percent return on shareholders’ common equity for our shareholders in the first quarter 2017, and paid a quarterly dividend of $0.39 per common share,” concluded Payne.

The annualized net interest margin on a fully taxable equivalent basis was 3.14 percent for the first quarter 2017, compared to 3.15 percent for the fourth quarter 2016, and 3.34 percent for the first quarter 2016. Net interest income on a fully taxable equivalent basis was $36.0 million for the first quarter 2017, compared to $36.0 million for the fourth quarter 2016, and $36.4 million for the first quarter 2016. The Company’s average earning assets, loans and investment securities, were $58 million higher in the first quarter 2017 compared to the fourth quarter 2016 due to higher volumes of investment securities. The annualized funding cost of deposits and other interest-bearing borrowings, as a percentage of average earning assets, was 0.04 percent for the first quarter 2017, compared to 0.04 percent for the fourth quarter 2016 and 0.05 percent for the first quarter 2016. Checking and savings deposits, which earn relatively low interest rates and are less volatile than time deposits during periods of rising market interest rates, represented 95 percent of average total deposits during the first quarter 2017.

The provision for loan losses was zero for the first quarter 2017, fourth quarter 2016 and first quarter 2016.

Loan losses, net of loan loss recoveries, were $1.0 million for the first quarter 2017 compared to $405 thousand for the fourth quarter 2016 and $284 thousand for the first quarter 2016; the increase in net loan losses in the first quarter 2017 was due to higher charge-offs of consumer installment loans. At March 31, 2017, the allowance for loan losses totaled $24.9 million.

Noninterest income for the first quarter 2017 totaled $11.7 million, compared $11.5 million for the fourth quarter 2016 and to $11.7 million for the first quarter 2016.

Noninterest expense for the first quarter 2017 totaled $24.6 million, compared to $24.6 million for the fourth quarter 2016 and $25.9 million for the first quarter 2016. The $1.3 million reduction from the first quarter 2016 to the first quarter 2017 was due to reductions in professional fees, courier costs, postage, correspondent service charges, OREO expense, insurance premiums, limited partnership operating losses, and intangible amortization.

The first quarter 2017 income tax provision reflects the prospective adoption of Accounting Standards Update (“ASU”) 2016-09, “Improvements to Employee Share-Based Payment Accounting.” Upon granting non-qualified stock options (“NQSO”), the Company estimates the fair value of the grant and records such value as compensation expense over the attribution period in its financial statements. At the time the NQSO grant is exercised, the ultimate value of the grant is determined and represents taxable income to the grantee and a tax deduction for the Company. The difference between the estimated fair value expensed for financial statement purposes and the realized amount deducted for tax purposes requires a reconciling adjustment to the Company’s tax accounts. Prior to ASU 2016-09, the Company recognized the balancing entry as an adjustment to shareholders’ equity; upon the January 1, 2017 required adoption of ASU 2016-09, the Company must recognize the balancing entry as an adjustment to the provision for income taxes. The Company’s fully-tax equivalent tax rate was 34.8 percent for the first quarter 2017, compared to 37.0 percent for the fourth quarter 2016 and 36.3 percent for the first quarter 2016. The first quarter 2017 fully-tax equivalent tax rate would have been 37.7 percent under accounting rules applied in 2016.

At March 31, 2017, Westamerica Bancorporation's tangible common equity-to-asset ratio was 8.68 percent, and assets totaled $5.4 billion. Westamerica Bancorporation, through its wholly owned subsidiary Westamerica Bank, operates commercial banking and trust offices throughout Northern and Central California.

Westamerica Bancorporation Web Address: www.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, 2016 filed on Form 10-K and quarterly report for the quarter ended September 30, 2016 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, legislation including the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2011, 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.