Westamerica Bancorporation Reports Fourth Quarter 2023 Financial Results

 | Quelle: Westamerica Bancorporation Westamerica Bancorporation

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)
    % 
  Q4'2023Q4'2022ChangeQ3'2023
      
 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  30% 29%  28%
      
    % 
  12/31'23YTD12/31'22YTDChange 
      
 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  28% 37%  
      
2. Net Interest Income.    
  (dollars in thousands)
    % 
  Q4'2023Q4'2022ChangeQ3'2023
      
 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%
      
    % 
  12/31'23YTD12/31'22YTDChange 
      
 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)
    % 
  Q4'2023Q4'2022ChangeQ3'2023
      
 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%
      
    % 
  12/31'23YTD12/31'22YTDChange 
      
 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)
    % 
  Q4'2023Q4'2022ChangeQ3'2023
      
 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%
      
    % 
  12/31'23YTD12/31'22YTDChange 
      
 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 
  AverageIncome/Yield (a) / 
  VolumeExpenseRate (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  51 0.32% 
     Time greater than $100K 37,970  25 0.26% 
   Total Short-Term Borrowings  64,927  44 0.26% 
      
 Net Interest Income and     
 Margin (FTE) $69,738 4.41% 
      
  Q4'2022 
  AverageIncome/Yield (a) / 
  VolumeExpenseRate (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  96 0.03% 
     Savings 1,917,370  280 0.06% 
     Time less than $100K 74,201  51 0.27% 
     Time greater than $100K 59,720  36 0.24% 
   Total Short-Term Borrowings  73,594  12 0.06% 
      
 Net Interest Income and    
 Margin (FTE) $69,155 3.95% 
      
6. Noninterest Income.    
  (dollars in thousands except per-share amounts)
    % 
  Q4'2023Q4'2022ChangeQ3'2023
      
 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 66  103 -35.9% 78 
 Life Insurance Gains 1  7 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 
      
    % 
  12/31'23YTD12/31'22YTDChange 
      
 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)
    % 
  Q4'2023Q4'2022ChangeQ3'2023
      
 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%
      
    % 
  12/31'23YTD12/31'22YTDChange 
      
 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)
    % 
  Q4'2023Q4'2022ChangeQ3'2023
      
 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 -  6 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  60% 44%  46%
      
 Net ACLL Losses /    
 Avg. Total Loans (a) 0.40% 0.39%  0.50%
      
    % 
  12/31'23YTD12/31'22YTDChange 
      
 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) 6 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  72% 48%  
      
 Net ACLL Losses / Avg. Total Loans 0.25% 0.32%  
      
  (dollars in thousands)
    % 
  12/31/2312/31/22Change9/30/23
 Allowance for Credit Losses on Loans$16,867 $20,284 -16.8%$17,744 
 Allowance for Credit Losses on    
 Held to Maturity Securities 1  1 -33.0% 1 
 Total Allowance for Credit Losses$16,868 $20,285 -16.8%$17,745 
      
 Allowance for Unfunded    
 Credit Commitments$201 $201 0.0%$201 
      
9. Credit Quality.    
  (dollars in thousands)
    % 
  12/31/2312/31/22Change9/30/23
 Nonperforming Loans:    
    Nonperforming Nonaccrual Loans$401 $146 174.7%$205 
    Performing Nonaccrual Loans 2  - n/m  4 
 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)
    % 
  12/31/2312/31/22Change9/30/23
      
 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)
    % 
  Q4'2023Q4'2022ChangeQ3'2023
 Share Repurchase Programs:    
   Total Shares Repurchased / Canceled -  - n/m - 
   Average Repurchase Price$- $- n/m$- 
   Net Shares Issued (22) (2)n/m (1)
      
    % 
  12/31'23YTD12/31'22YTDChange 
      
   Total Shares Repurchased 274  3 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)
    % 
  12/31/2312/31/22Change9/30/23
 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  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)
    % 
  Q4'2023Q4'2022ChangeQ3'2023
 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  96 33.3% 131 
   Savings Deposits 1,431  280 411.1% 886 
   Time Deposits 76  87 -12.6% 78 
   Short-Term Borrowed Funds 44  12 266.7% 38 
     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 66  103 -35.9% 78 
   Life Insurance Gains 1  7 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 
    % 
  12/31'23YTD12/31'22YTDChange 
 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  79 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