West Bancorporation Inc ARS, filed Mar 5, 2024
West Bancorporation Inc (WTBA)
ARS
2024-03-05
For: 2023-12-31
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October 25, 2026
IN TH E M AK IN G 2 0 2 3 A N N U A L R E P O R T YEARS
W E S T B A N C O R P O R A T I O N I N C . A N D S U B S I D I A R I E S 1 Dear Stockholders: At West Bank, we use our successful relationship-based business model to grow stockholder value. Our incredible team of dedicated West Bankers positions us well to face today’s challenges and to capitalize on opportunities. We believe those opportunities will continue to grow as we have completed the construction of permanent offices in both St. Cloud and Mankato, Minnesota, and look forward to the completion of our new corporate headquarters in West Des Moines, Iowa, and a permanent office in Owatonna, Minnesota, later this year. Like others in our industry, our company experienced some significant margin challenges during 2023. The interest rate environment, including dramatic increases in short-term rates, an ongoing inverted yield curve, and aggressive deposit competition, all significantly impacted our cost of funds and net interest margin. We understand the forces challenging our industry, and we have a clear vision of our path forward to more normalized margins. Despite the challenges of this environment, our credit quality remains pristine. We hold no loans greater than 30 days past due and essentially no problem loans as of December 31, 2023. We continue to closely monitor and manage our credit quality as the economy changes and our customers respond to the higher interest rate environment. West Bank is 131 years old and is the oldest business of any type to be founded and remain headquartered in West Des Moines, Iowa. The development of our new headquarters has been many years in the making as part of our strategic plan. We have been a tenant in our current building for 52 years and planned for the creation of a new bank-owned headquarters to coincide with the expiration of our lease in 2024. Because of our steadfast commitment to invest in our community, we chose to construct the building on a site badly in need of revitalization. Redevelopment—versus building on clean ground—added complexity to our project, but we believe this step to help our community provides both strong leadership and an investment model for other businesses to follow. Our newest facilities serve as a point of pride in which our teams will work, collaborate, and continue to provide excellent service to our customers for decades to come. They also serve as venues for business development events and provide opportunities to cultivate new and existing customer relationships, which are central to our business model. We appreciate and thank you for your continued support and interest in our company. Sincerely, David D. Nelson CEO and President, West Bancorporation, Inc. Chair and CEO, West Bank
O U R M I S S I O N 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. COMMUNITY INVOLVEMENT WEST BANKERS IN MANKATO PARTICIPATED IN THE MINNESOTA BANKERS ASSOCIATION COMMUNITY IMPACT MONTH IN SEPTEMBER. THE TEAM HELPED SET UP A NEW EXHIBIT AT THE CHILDREN’S MUSEUM OF SOUTHERN MINNESOTA AND DELIVERED TREATS TO MANKATO YOUTH PLACE, EARNING THEM RECOGNITION AS A “COMMUNITY CHAMPION.”
W E A R E P R O U D O F O U R W E S T B A N K T E A M A N D T H E I R C O M M I T M E N T T O O U R C O M M U N I T I E S . W E S T B A N C O R P O R A T I O N I N C . A N D S U B S I D I A R I E S 3 MORE THAN $730,000 IN SUPPORT FOR COMMUNITY NONPROFIT ORGANIZATIONS ≥ OVER $260,000 awarded in grants » $171,884 in human services » $69,000 in education » $26,250 in arts & culture ≥ OVER $470,000 in donations/ sponsorships to community organizations ≥ OVER $218,000 went to organizations supporting youth in our communities ≥ WEST BANK FOUNDATION AND WEST BANK GAVE $29,600 to help 9 organizations fighting homelessness in our communities ≥ IN 2023, WEST BANK EMPLOYEES VOLUNTEERED OVER 8,000 hours of community service
2023 ANNUAL REPORT YEARS IN TH E M AK IN G
W E S T B A N C O R P O R A T I O N I N C . A N D S U B S I D I A R I E S 5 In 1958, companies listed on Standard & Poor’s 500 had an average lifespan of 61 years. However, a recent study by McKinsey & Company shows that the average lifespan of these companies has decreased significantly, and today it is less than 18 years. West Bank has far exceeded today’s norm and is now celebrating its 131st anniversary, which is a testament to its endurance and success as a community bank. Since its simple beginnings on the muddy streets of Valley Junction in 1893, West Bank has seen its share of change. As West Des Moines’ oldest existing business, the bank has survived recessions and a depression, 23 U.S. presidents have come and gone, and improvements to technology have dramatically changed all aspects of human life. Despite it all, West Bank continues to thrive, regardless of what it faces. Its investment into people and deep-rooted relationships continues to be the strength behind its resilience and ability to weather changes in government policy, unprecedented interest rate hikes, and economic variability. After more than 50 years renting the same building, the lease on West Bank’s headquarters will expire in 2024. We move into our new headquarters in April 2024—a project years in the making. As a show of commitment to our community, the new headquarters was built at 3330 Westown Parkway, an area of West Des Moines in drastic need of a catalyst for revitalization. Not only will the facility provide the bank with a home to better serve its customers, it was designed to further our desire to build and maintain relationships with the people who have helped make West Bank strong. NEW WEST BANK HEADQUARTERS FUN FACTS ≥ There is approximately 11,500 SF of exterior vision glass on the building. That is equivalent to: » Over 2 ½ basketball courts » Over 270 king size mattresses » Over 100,000 dollar bills ≥ Square Footage – 73,327 SF » Level One – 17,443 SF » Level Two – 18,500 SF » Level Three – 18,651 SF » Level Four – 18,783 SF » With an additional 11,000 SF of outdoor patio on Level One ≥ How many geo-thermal wells? » 122 – each is 400’ deep ≥ How many mixer truck loads did it take to pour one of the floors? » 28 Truckloads ≥ How much does one floor of concrete weigh? » 534.6 Tons ≥ How much steel is in the building? » 485 Tons ≥ Ratio of the exterior, stone to glass? » Approximately 50/50: Stone – 14,483 SF, Window/Glazing – 14,490 SF ≥ What are the dimensions of the pond? » 453’L x 70’W x 10’D ≥ How much soil material was hauled off the site? » About 35,000 cubic yards, which is more than 10 Olympic-size pools.
W E S T B A N C O R P O R A T I O N I N C . A N D S U B S I D I A R I E S 7
West Bank broke ground on the new Owatonna, Minnesota, location in August of 2023. When the new building opens this fall, it will mark the successful completion of upgrades to all of West Bank’s Minnesota locations. These wonderful spaces across the southern portion of the state will facilitate new business development and help build strong customer relationships. This location is yet another example of West Bank helping its community by building this facility in a part of Owatonna in need of revitalization. As part of the new riverfront project, West Bank will join other community partners to create the city’s first mixed-use development project. O W A T O N N A RIVERFRONT PROJECT ARCHITECTURAL RENDERING
W E S T B A N C O R P O R A T I O N I N C . A N D S U B S I D I A R I E S 9 M A N K A T O In November of 2023, West Bank opened a new location in a state-of-the-art building located at 1911 Premier Drive in Mankato, Minnesota. The West Bank team is looking forward to sharing this unique facility with the community and providing an unparalleled banking experience for their customers. The two-story building has an eye-catching roofline and was designed by the architectural firm HGA and constructed by A.B. Systems.
The Iowa Bankers Association honored Kay Trager as a 50-year banker. Kay is a highly experienced banking professional with an impressive 51-year career at West Bank. She has held many leadership positions within the bank, ranging from financial and accounting to heading up the customer service department, ensuring that West Bank’s customers received top-notch service. Kay joined the company in 1972 as a teller shortly after graduating from Grandview College. Kay was hired when West Bank was adding additional staff in anticipation of opening the brand new “Main” Bank at 1601 22nd Street in West Des Moines. Throughout her time at West Bank, Kay has demonstrated her versatility and expertise by taking on various customer-facing roles. However, her passion for the intricacies of banking led her to transition to a back-office role in the bookkeeping department, where she developed a keen attention to detail and meticulousness, which became the foundation of her successful banking career. Throughout her impressive tenure at West Bank, Kay has continued to learn and grow, making valuable contributions along the way. Her remarkable dedication to banking and commitment to learning serve as an inspiration to her colleagues and peers. KAY TRAGER IOWA BANKERS ASSOCIATION 50-YEAR BANKER AWARD MILESTONE ANNIVERSARIES: ≥ AL PETERSEN 20 Years ≥ MARK MOORE 20 Years ≥ GEOFF GADE 30 Years ≥ BARRY CROPP 30 Years ≥ RICHARD MOCKOBEE 35 Years
DAVE NELSON W E S T B A N C O R P O R A T I O N I N C . A N D S U B S I D I A R I E S 11 IOWA BANKERS ASSOCIATION JAMES A. LEACH LEADERSHIP AWARD The Iowa Bankers Association presented West Bank Chair and CEO Dave Nelson with the James A. Leach Leadership Award in 2023, during the Iowa Bankers Association (IBA) Annual Convention at Veterans Memorial Auditorium. The IBA created the Leach Award in 2000 in honor of Congressman James A. Leach, a previous chairman of the U.S. House Banking Committee. This annual award honors an Iowa banker who, like Leach, has worked to support and uplift Iowa banking and Iowa communities. Dave began his 39-year career in community banking in 1984, becoming a bank president in Rochester, Minnesota, in 1995. He served in that capacity until joining West Bank as CEO in 2010. He is an approachable leader who is personally committed to and invested in the success of not just his West Bank team and customers, but also the bank’s communities. During his time at West Bank, Dave has made significant contributions both to the success of West Bank and to community banking in Iowa. Under his leadership, West Bank has been repeatedly recognized as one of the best-performing banks in America by numerous national publications; in many of those instances, West Bank was one of very few in the Midwest to be recognized. As an advocate for community banking, Dave served as chairman of the Iowa Bankers Association from 2016-2017. He now serves on the board of directors for the American Bankers Association (ABA). He regularly travels to Washington, D.C., to talk to representatives in Congress and keeps in regular contact with our elected representatives to consult with them on matters impacting community banks.
LEFT TO RIGHT: LISA ELMING, GEORGE MILLIGAN, ROSEMARY PARSON, STEVEN GAER, HARLEE OLAFSON, DOUGLAS GULLING, BRADLEY PETERS, SEAN MCMURRAY, DAVE NELSON, PATRICK DONOVAN, JANE FUNK, PHILIP JASON WORTH, BRAD WINTERBOTTOM, STEVEN SCHULER, JAMES NOYCE, THERESE VAUGHAN YEARS I N T H E M A K I N G
W E S T B A N C O R P O R A T I O N I N C . A N D S U B S I D I A R I E S 13 LE A D E R S H IP 2 0 2 3 A N N U A L R E P O R T
BOARD OF DIRECTORS BRADLEY PETERS** EVP, West Bancorporation; EVP and Minnesota Group President, West Bank JAMES NOYCE* Chair, West Bancorporation DAVID NELSON* CEO and President, West Bancorporation; Chair and CEO, West Bank JANE FUNK** EVP, Treasurer and Chief Financial Officer, West Bancorporation; EVP and Chief Financial Officer, West Bank BRAD WINTERBOTTOM** EVP, West Bancorporation; President, West Bank HARLEE OLAFSON** EVP and Chief Risk Officer, West Bancorporation; EVP and Chief Risk Officer, West Bank SEAN MCMURRAY* Businessolver, Inc. DOUGLAS GULLING* Bank Building Construction Administrator, West Bank PATRICK DONOVAN* Retired LISA ELMING* Retired STEVEN GAER* Recoop Disaster Insurance GEORGE MILLIGAN* The Graham Group, Inc. ROSEMARY PARSON* EquiTrust Life Insurance Company STEVEN SCHULER* Retired THERESE VAUGHAN* Retired PHILIP JASON WORTH* Gilcrest/Jewett Lumber Company * Director of West Bancorporation, Inc. and West Bank ** Director of West Bank
W E S T B A N C O R P O R A T I O N I N C . A N D S U B S I D I A R I E S 15 CENTRAL IOWA COMMUNITY BOARD RHONDA BURKHARDT The Underground Company, LTD JERRY DEEGAN Retired DARIN FERGUSON Ferguson Commercial Real Estate Services RYAN FLYNN, CPA Flynn + Sweeney, LLC KEVIN GRIMM Investor/Consultant BRIAN LOFFREDO Loffredo Fresh Produce GREG LAMAIR Assured Partners LLC DAVE MOENCH Wolfe Eye Clinic STEVE SCHWEIZER Denman & Company VICTORIA VEIOCK Bing’s JEFF YURGAE Mueller-Yurgae Associates, Inc. EASTERN IOWA COMMUNITY BOARD MATT ADAM Simmons Perrine Moyer Bergman PLC RODNEY ANDERSON Pancheros Mexican Grill JILL ARMSTRONG Skogman Realty DAVID BARKER Barker Apartments ADAM BRANTMAN Brava Roof Tile KEVIN DIGMANN Hodge Construction LUKE RECKER Styker Corporation CHUCK SKAUGSTAD The Mansion Town Square Developers LEIGHTON SMITH BerganKDV BEN KINSETH Kinseth Hospitality Company All six of our community boards are non-voting advisory boards with knowledge of the communities we serve. TAYLOR BROWN Brown NationaLease RAVI PATEL Hawkeye Hotels ANDY HODGE Hodge Construction
MANKATO COMMUNITY BOARD BRYAN BODE Investor/Consultant MARK DRAPER River City Electric Company DR. WYNN KEARNEY Retired Surgeon/Investor STEVE KIBBLE Siesta Hills BRUCE KINSELLA Philanthropic Consulting DAVID PFEFFER Vintage Fine Homes, Inc. MARK PHINNEY C&N Sales Company RANDY WESTMAN Westman Investments ART WESTPHAL Bethany Lutheran College ANDREW WILLAERT Gislason & Hunter LLP OWATONNA COMMUNITY BOARD DALE BUYTAERT Clifton Larson Allen LLP MARK FREERKSEN Freerksen Trucking, Inc. CHAD HANSON Main Street Dental Clinics THERESA JAMES James Brothers Construction SCOTT MOHS Mohs Contracting Mohs Homes MIKE NOBLE Investor/Retired PAT NOBLE National Online Consignment and Rental DARREN ROEMHILDT Bridges Chiropractic Health Clinic BRANDON WAYNE Wayne–Norrid–Wetmore Wealth Management All six of our community boards are non-voting advisory boards with knowledge of the communities we serve.
W E S T B A N C O R P O R A T I O N I N C . A N D S U B S I D I A R I E S 17 ROCHESTER COMMUNITY BOARD JASON BOYNTON, CPA Smith Schafer & Associates JEFF BROWN, JR. North Rock Real Estate MICHAEL BUSCH Paramark Corp. PATRICK DEUTSCH Pace International BOBBIE GOSTOUT, M.D. Vice President Emeritus, Mayo Clinic HAL HENDERSON HGA DICK KUEHN Kuehn Motors BRIAN LEARY Pharmaceutical Specialties, Inc. DAVID PEDERSON Dunlap & Seeger, P.A. PETER SCHULLER A.B. Systems, Inc. ED STANLEY Merit Building Enclosure Systems ST. CLOUD COMMUNITY BOARD DAVID BERDAN J-Berd Companies BYRON BJORKLUND Custom Catering by Short Stop JEFF DROWN Lyon Contracting STEVE FENEIS GC Real Estate Partners JASON FERCHE Ferche Companies MARC SANDERSON Wilkie Sanderson DR. KEVIN SMITH Regional Diagnostic Radiology ERIC STACK Millerbernd Manufacturing TIM TORBORG Torborg Builders HEIDI WEIKERT S.T. Cotter Turbine Services All six of our community boards are non-voting advisory boards with knowledge of the communities we serve. CHRIS TERRY Hamilton Real Estate Group NATALIE VICTORIA Victoria’s Restaurant and The Tap House GREG WINDFELDT PCI
2 0 2 3 A N N U A L R E P O R T F IN A N C IA L S
W E S T B A N C O R P O R A T I O N I N C . A N D S U B S I D I A R I E S 19 2023 2022 2021 RESULTS OF OPERATIONS Net interest income $ 69,031 $ 91,740 $ 95,059 Credit loss expense (benefit) 700 (2,500) (1,500) Noninterest income 10,066 10,208 9,729 Noninterest expense 48,611 45,051 43,380 Income before income taxes 29,786 59,397 62,908 Net income 24,137 46,399 49,607 PER COMMON SHARE Cash dividends $ 1.00 $ 1.00 $ 0.94 Basic earnings 1.44 2.79 3.00 Diluted earnings 1.44 2.76 2.95 Closing stock price 21.20 25.55 31.07 Book value 13.46 12.69 15.73 YEAR-END BALANCES Assets $ 3,825,758 $ 3,613,218 $ 3,500,201 Investment securities 646,876 683,451 768,787 Loans 2,927,535 2,742,836 2,456,196 Nonperforming loans 296 322 8,948 Other real estate owned — — — Deposits 2,973,779 2,880,408 3,016,005 Stockholders’ equity 225,043 211,112 260,328 RATIOS Return on average assets 0.66% 1.32% 1.52% Return on average equity 11.42% 20.71% 20.33% Texas ratio (1) 0.12% 0.14% 3.10% Efficiency ratio (1) (2) 60.73% 43.70% 40.91% Dividend payout ratio 69.21% 35.82% 31.33% Dividend yield 4.72% 3.91% 3.03% Net interest margin (2) 2.01% 2.76% 3.05% Allowance for credit losses as a % of loans 0.97% 0.93% 1.15% Net (charge-offs) recoveries as % of average loans 0.00% (0.02%) 0.02% Nonperforming loans as % of loans 0.01% 0.01% 0.36% Tangible common equity to tangible assets 5.88% 5.84% 7.44% (1) A lower ratio is better. (2) As presented, this is a non-GAAP measure - see “Non-GAAP Financial Measures” for additional details. FINANCIAL HIGHLIGHTS AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2023, 2022, AND 2021 (dollars in thousands, except per share data)
DECEMBER 31, 2023 AND 2022 (dollars in thousands, except per share data) ASSETS Cash and due from banks Interest-bearing deposits Cash and cash equivalents Securities available for sale, at fair value Federal Home Loan Bank stock, at cost Loans Allowance for credit losses Loans, net Premises and equipment, net Accrued interest receivable Bank-owned life insurance Deferred tax assets, net Other assets TOTAL ASSETS LIABILITIES AND STOCKHOLDERS’ EQUITY LIABILITIES Deposits Noninterest-bearing demand Interest-bearing demand Savings and money market Time Total deposits Federal funds purchased and other short-term borrowings Subordinated notes, net Federal Home Loan Bank advances Long-term debt Accrued expenses and other liabilities TOTAL LIABILITIES STOCKHOLDERS’ EQUITY Preferred stock, $0.01 par value; authorized 50,000,000 shares; no shares issued and outstanding at December 31, 2023 and 2022 Common stock, no par value; authorized 50,000,000 shares; 16,725,094 and 16,640,413 shares issued and outstanding at December 31, 2023 and 2022, respectively Additional paid-in capital Retained earnings Accumulated other comprehensive loss Total stockholders’ equity TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY CONSOLIDATED BALANCE SHEETS DECEMBER 31, $ 33,245 32,112 65,357 623,919 22,957 2,927,535 (28,342) 2,899,193 86,399 13,581 43,864 34,303 36,185 $ 3,825,758 $ 548,726 481,207 1,440,076 503,770 2,973,779 150,270 79,631 315,000 47,736 34,299 3,600,715 — 3,000 34,197 271,369 (83,523) 225,043 $ 3,825,758 $ 24,896 1,643 26,539 664,115 19,336 2,742,836 (25,473) 2,717,363 53,124 11,988 44,573 36,609 39,571 $ 3,613,218 $ 693,563 536,226 1,237,954 412,665 2,880,408 200,000 79,369 155,000 51,486 35,843 3,402,106 — 3,000 32,021 267,562 (91,471) 211,112 $ 3,613,218 20222023
W E S T B A N C O R P O R A T I O N . I N C . A N D S U B S I D I A R I E S 21 CONSOLIDATED STATEMENTS OF INCOME YEARS ENDED DECEMBER 31, 2023, 2022, AND 2021 (dollars in thousands, except per share data) 2023 2022 2021 INTEREST INCOME Loans, including fees $ 142,923 $ 107,095 $ 95,585 Securities: Taxable 13,696 12,524 8,542 Tax-exempt 3,517 3,527 2,861 Interest-bearing deposits 169 203 292 TOTAL INTEREST INCOME 160,305 123,349 107,280 INTEREST EXPENSE Deposits 66,796 22,629 7,948 Federal funds purchased and other short-term borrowings 9,532 1,764 5 Subordinated notes 4,442 2,867 1,008 Federal Home Loan Bank advances 7,694 2,669 2,944 Long-term debt 2,810 1,680 316 TOTAL INTEREST EXPENSE 91,274 31,609 12,221 NET INTEREST INCOME 69,031 91,740 95,059 CREDIT LOSS EXPENSE (BENEFIT) 700 (2,500) (1,500) NET INTEREST INCOME AFTER CREDIT LOSS EXPENSE (BENEFIT) 68,331 94,240 96,559 NONINTEREST INCOME Service charges on deposit accounts 1,859 2,194 2,352 Debit card usage fees 1,980 1,969 1,948 Trust services 3,068 2,709 2,671 Increase in cash value of bank-owned life insurance 1,044 964 923 Gain from bank-owned life insurance 691 — — Loan swap fees 431 835 66 Realized securities gains (losses), net (431) — 51 Other income 1,424 1,537 1,718 TOTAL NONINTEREST INCOME 10,066 10,208 9,729 NONINTEREST EXPENSE Salaries and employee benefits 27,060 25,838 23,226 Occupancy and equipment 5,507 4,913 5,162 Data processing 2,790 2,597 2,465 Technology and software 2,341 2,137 1,777 FDIC insurance 1,750 996 1,818 Professional fees 1,026 874 946 Directors fees 892 814 765 Other expenses 7,245 6,882 7,221 TOTAL NONINTEREST EXPENSE 48,611 45,051 43,380 INCOME BEFORE INCOME TAXES 29,786 59,397 62,908 INCOME TAXES 5,649 12,998 13,301 NET INCOME $ 24,137 $ 46,399 $ 49,607 EARNINGS PER COMMON SHARE Basic earnings per common share $ 1.44 $ 2.79 $ 3.00 Diluted earnings per common share $ 1.44 $ 2.76 $ 2.95 YEAR ENDED DECEMBER 31
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2023, 2022, 2021 (dollars in thousands, except per share data) 2023 2022 2021 DECEMBER 31 NON-GAAP FINANCIAL MEASURES RECONCILIATION OF NET INTEREST INCOME AND NET INTEREST MARGIN ON AN FTE BASIS TO GAAP: Net interest income (GAAP) Tax-equivalent adjustment (1) Net interest income on an FTE basis (non-GAAP) Average interest-earning assets Net interest margin on an FTE basis (non-GAAP) RECONCILIATION OF EFFICIENCY RATIO ON AN FTE BASIS TO GAAP: Net interest income on an FTE basis (non-GAAP) Noninterest income Adjustment for realized securities (gains) losses, net Adjustment for losses on disposal of premises and equipment, net Adjusted income Noninterest expense Efficiency ratio on an adjusted FTE basis (non-GAAP) (2) $ 69,031 491 $ 69,522 $ 3,465,964 2.01% $ 69,522 10,066 431 29 $ 80,048 $ 48,611 60.73% $ 91,740 1,122 $ 92,862 $ 3,361,091 2.76% $92,862 10,208 — 29 $ 103,099 $ 45,051 43.70% $ 95,059 1,202 $ 96,261 $ 3,152,138 3.05% $ 96,261 9,729 (51) 84 $ 106,023 $ 43,380 40.91% (1) Computed on a tax-equivalent basis using an incremental federal income tax rate of 21 percent, adjusted to reflect the effect of 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. REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of West Bancorporation, Inc. We have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of West Bancorporation, Inc. and its subsidiary, West Bank, as of December 31, 2023 and 2022, and the related consolidated statements of income, comprehensive income (not presented herein), stockholders’ equity (not presented herein) and cash flows (not presented herein) for each of the three years in the period ended December 31, 2023; and in our report, dated February 21, 2024, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed financial statements is fairly stated, in all material respects, in relation to the consolidated financial statements from which it has been derived. Des Moines, Iowa | February 21, 2024
W E S T B A N C O R P O R A T I O N I N C . A N D S U B S I D I A R I E S 23 FORM 10-K A copy of the Company’s annual report on Form 10-K filed with the Securities and Exchange Commission will be available on the Securities and Exchange Commission’s website at www.sec.gov and through a link on the Company’s website, westbankstrong.com, under Investor Relations—SEC Filings—Documents. A copy of the annual report can also be obtained upon request to Melissa Gillespie, Corporate Secretary, mgillespie@westbankstrong.com, 515-222-2370. MARKET AND DIVIDEND INFORMATION (1) STOCK INFORMATION 2023 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter Total 2022 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter Total HIGH $ 22.39 20.91 19.96 25.80 $ 25.62 26.26 27.51 32.60 (1) The prices shown are the high, low and closing sale prices for the Company’s common stock. The market quotations, reported by Nasdaq, do not include retail markup, markdown or commissions. West Bancorporation Inc. common stock is traded on the Nasdaq Global Select Market (WTBA), and quotations are furnished by the Nasdaq System. We had 150 common stockholders of record on December 31, 2023 and an estimated 4,000 additional beneficial holders whose stock was held in street name by brokerages or fiduciaries. $ 15.25 16.25 15.04 17.58 $ 20.50 20.39 22.88 27.07 LOW $ 21.20 16.31 18.41 18.27 $ 25.55 20.81 24.34 27.21 CLOSE $ 0.25 0.25 0.25 0.25 $ 1.00 $ 0.25 0.25 0.25 0.25 $ 1.00 DIVIDENDS TRANSFER AGENT AND REGISTRAR Equiniti Trust Company, LLC 6201 15th Avenue, Brooklyn, New York 11219 800-937-5449 www.equiniti.com
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 recent and potential additional rate increases 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 rising 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 at Silicon Valley Bank, Signature Bank and First Republic Bank that resulted in the failure of those institutions; changes in legal and regulatory requirements, limitations and costs including in response to the recent failures of Silicon Valley Bank, Signature Bank and First Republic Bank; 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 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; the new 1 percent excise tax on stock buybacks by publicly traded companies; 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. 2 0 2 3 A N N U A L R E P O R T24 FORWARD-LOOKING STATEMENTS
2 0 2 3 A N N U A L R E P O R T IOWA MAIN BANK 1601 22nd St. West Des Moines CORALVILLE 401 10th Ave. Coralville EAST 2440 East Euclid Ave. Des Moines GRAND 125 Grand Ave. West Des Moines SOUTH 3920 SW 9th St. Des Moines WAUKEE 955 East Hickman Rd. Waukee CITY CENTER 809 6th Ave. Des Moines MINNESOTA MANKATO 1911 Premier Dr. Mankato OWATONNA 345 Florence Ave., Ste. 101 Owatonna ROCHESTER 2188 Superior Dr. NW Rochester ST. CLOUD 1800 Bellin Dr. St. Cloud ONLINE WESTBANKSTRONG.COM @WESTBANKSTRONG L O C A T IO N S
2 0 2 3 A N N U A L R E P O R T