wtba-20220127
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


Date of Report (Date of Earliest Event Reported): January 27, 2022


WEST BANCORPORATION, INC.
(Exact name of registrant as specified in its charter)

Iowa0-4967742-1230603
(State or other jurisdiction of incorporation)(Commission File Number)(I.R.S. Employer Identification No.)


1601 22nd Street, West Des Moines, Iowa 50266
(Address of principal executive offices) (Zip Code)


Registrant's telephone number, including area code: 515-222-2300


Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered or to be registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, no par valueWTBAThe Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o


Item 2.02 Results of Operations and Financial Condition.

On January 27, 2022, West Bancorporation, Inc. (the "Company") issued a press release announcing its annual and fourth quarter earnings results for the periods ended December 31, 2021, and the declaration of a quarterly dividend. The press release is furnished as Exhibit 99.1.

Item 9.01 Financial Statements and Exhibits.
(d) Exhibits:
Exhibit NumberDescription
99.1
104Cover Page Interactive Data File (embedded within the Inline XBRL document)



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

West Bancorporation, Inc.
January 27, 2022By:/s/ Jane M. Funk
Name: Jane M. Funk
Title: Executive Vice President, Treasurer and Chief Financial Officer





Exhibit 99.1

wtbalogoedita06a01a01a01a22a.jpg


Press Release
 
January 27, 2022
 
FOR IMMEDIATE RELEASE
For more information contact:
Jane Funk, Executive Vice President, Treasurer and Chief Financial Officer (515) 222-5766
 
WEST BANCORPORATION, INC. ANNOUNCES RECORD NET INCOME, DECLARES INCREASED QUARTERLY DIVIDEND

West Des Moines, IA - West Bancorporation, Inc. (Nasdaq: WTBA; the “Company”), parent company of West Bank, today reported 2021 net income was $49.6 million, or $2.95 per diluted common share, compared to 2020 net income of $32.7 million, or $1.98 per diluted common share. Net income for the fourth quarter of 2021 was $11.9 million, or $0.71 per diluted common share, compared to fourth quarter 2020 net income of $8.6 million, or $0.52 per diluted common share. On January 26, 2022, the Company’s Board of Directors declared a regular quarterly dividend of $0.25 per common share, an increase of $0.01 from the prior quarter and representing a record high quarterly dividend for the Company. The dividend is payable on February 23, 2022, to stockholders of record on February 9, 2022.

The Company recorded negative provision for loan losses of $1,500 for the year ended December 31, 2021, compared to provision for loan losses of $12,000 for the year ended December 31, 2020. The provision in 2020 was due to the onset of the global pandemic, whereas 2021 includes a reserve release due to the improving economic outlook.

David Nelson, President and Chief Executive Officer of the Company, commented, “West Bancorporation, Inc. experienced extraordinary financial performance in 2021. Net income increased 52 percent in 2021, compared to 2020, and net interest income increased 15 percent in 2021, compared to 2020. Total assets were $3.5 billion at December 31, 2021, compared to $3.2 billion at December 31, 2020. We experienced loan growth (exclusive of Paycheck Protection Program loan activity) of 16 percent and deposit growth of 12 percent in 2021. Our credit quality continues to improve as classified and impaired loans were paid down and paid off. As of December 31, 2021, the Texas ratio declined to 3.10 percent and there were no loans past due more than 30 days.”

David Nelson added, “We currently have four new bank building projects in various stages of planning and development. These buildings represent our commitment to our customers, our employees and the communities we serve as we continue our pursuit of excellence.”

The Company will file its report on Form 10-K with the Securities and Exchange Commission on or before February 24, 2022. Please refer to that document for a more in-depth discussion of the Company’s financial results. The Form 10-K will be available on the Investor Relations section of West Bank’s website at www.westbankstrong.com.

The Company will discuss its financial results on a conference call scheduled for 10:00 a.m. Central Time tomorrow, Friday, January 28, 2022. The telephone number for the conference call is 888-339-0814. A recording of the call will be available until February 11, 2022, by dialing 877-344-7529. The replay passcode is 3153348.

About West Bancorporation, Inc. (Nasdaq: WTBA)
West Bancorporation, Inc. is headquartered in West Des Moines, Iowa. Serving customers 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 small- to medium-sized businesses and consumers. West Bank has seven offices in the Des Moines, Iowa metropolitan area, one office in Coralville, Iowa, and four offices in Minnesota in the cities of Rochester, Owatonna, Mankato and St. Cloud.




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: the effects of the COVID-19 pandemic, including its effects on the economic environment, our customers and our operations, including due to supply chain disruptions, as well as any changes to federal, state or local government laws, regulations or orders in connection with the pandemic; interest rate risk; competitive pressures, including from non-bank competitors such as “fintech” companies; pricing pressures on loans and deposits; changes in credit and other risks posed by the Company’s loan and investment portfolios, including declines in commercial or residential real estate values or changes in the allowance for loan losses dictated by new market conditions, accounting standards (including as a result of the future implementation of the current expected credit loss (CECL) accounting standard) or regulatory requirements; changes in local, national and international economic conditions, including rising rates of inflation; changes in legal and regulatory requirements, limitations and costs; changes in customers’ acceptance of the Company’s products and services; cyber-attacks; unexpected outcomes of existing or new litigation involving the Company; the monetary, trade and other regulatory policies of the U.S. government, including anticipated rate increases; acts of war or terrorism, widespread disease or pandemics, such as the COVID-19 pandemic, or other adverse external events; developments and uncertainty related to the future use and availability of some reference rates, such as the London Interbank Offered Rate, as well as other alternative reference rates; changes to U.S. tax laws, regulations and guidance; liquidity risk due to excess liquidity at the Company’s bank subsidiary; talent and labor shortages; 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.




WEST BANCORPORATION, INC. AND SUBSIDIARY
Financial Information (unaudited)
(in thousands)
CONSOLIDATED BALANCE SHEETSDecember 31, 2021December 31, 2020
Assets
Cash and due from banks$17,555 $77,693 
Federal funds sold175,270 318,742 
Securities available for sale, at fair value758,822 420,571 
Federal Home Loan Bank stock, at cost9,965 11,723 
Loans2,456,196 2,280,575 
Allowance for loan losses(28,364)(29,436)
Loans, net2,427,832 2,251,139 
Premises and equipment, net34,568 29,077 
Bank-owned life insurance43,609 42,686 
Other assets32,580 34,113 
Total assets$3,500,201 $3,185,744 
Liabilities and Stockholders’ Equity
Deposits:
Noninterest-bearing demand$720,136 $696,731 
Interest-bearing:
Demand548,242 553,881 
Savings1,550,636 1,274,254 
Time of $250 or more53,019 46,907 
Other time143,972 129,221 
Total deposits3,016,005 2,700,994 
Federal funds purchased2,880 5,375 
Other borrowings196,986 217,010 
Other liabilities24,002 38,670 
Stockholders’ equity260,328 223,695 
Total liabilities and stockholders’ equity$3,500,201 $3,185,744 



WEST BANCORPORATION, INC. AND SUBSIDIARY
Financial Information (continued) (unaudited)
(in thousands)
Three Months Ended December 31,Year Ended December 31,
CONSOLIDATED STATEMENTS OF INCOME2021202020212020
Interest income
Loans, including fees$24,179 $23,536 $95,585 $90,668 
Securities3,419 2,162 11,403 9,261 
Other66 48 292 304 
Total interest income27,664 25,746 107,280 100,233 
Interest expense
Deposits2,055 1,913 7,948 11,256 
Federal funds purchased1 2 5 23 
Other borrowings1,006 1,341 4,268 6,121 
Total interest expense3,062 3,256 12,221 17,400 
Net interest income24,602 22,490 95,059 82,833 
Provision for loan losses— 4,000 (1,500)12,000 
Net interest income after provision for loan losses24,602 18,490 96,559 70,833 
Noninterest income
Service charges on deposit accounts603 617 2,352 2,360 
Debit card usage fees505 427 1,948 1,632 
Trust services633 601 2,671 2,078 
Increase in cash value of bank-owned life insurance233 166 923 593 
Loan swap fees24 — 66 1,572 
Realized securities gains (losses), net— (4)51 77 
Other income350 297 1,718 1,290 
Total noninterest income2,348 2,104 9,729 9,602 
Noninterest expense
Salaries and employee benefits5,928 5,577 23,226 21,591 
Occupancy1,532 1,228 5,162 4,879 
Data processing630 575 2,465 2,331 
FDIC insurance460 330 1,818 1,210 
Other expenses3,321 2,205 10,709 9,043 
Total noninterest expense11,871 9,915 43,380 39,054 
Income before income taxes15,079 10,679 62,908 41,381 
Income taxes3,169 2,125 13,301 8,669 
Net income$11,910 $8,554 $49,607 $32,712 



WEST BANCORPORATION, INC. AND SUBSIDIARY
Financial Information (continued) (unaudited)
PER COMMON SHAREMARKET INFORMATION (1)
Net Income
BasicDilutedDividendsHighLow
2021
4th Quarter$0.72 $0.71 $0.24 $34.50 $29.30 
3rd Quarter0.77 0.76 0.24 31.98 26.26 
2nd Quarter0.80 0.79 0.24 29.90 23.92 
1st Quarter0.71 0.70 0.22 26.78 18.86 
2020
4th Quarter$0.52 $0.52 $0.21 $21.79 $15.53 
3rd Quarter0.49 0.49 0.21 17.99 15.50 
2nd Quarter0.48 0.48 0.21 20.67 14.50 
1st Quarter0.49 0.49 0.21 25.68 13.74 
(1) The prices shown are the high and low sale prices for the Company’s common stock, which trades on the Nasdaq Global Select Market under the symbol WTBA. The market quotations, reported by Nasdaq, do not include retail markup, markdown or commissions.

Three Months Ended December 31,Year Ended December 31,
SELECTED FINANCIAL MEASURES2021202020212020
Return on average assets1.38 %1.15 %1.52 %1.19 %
Return on average equity18.51 %15.54 %20.33 %15.49 %
Net interest margin on a FTE basis (1)
3.00 %3.20 %3.05 %3.20 %
Efficiency ratio (1)(2)
43.32 %39.99 %40.91 %41.96 %
As of December 31,
20212020
Texas ratio (2)
3.10 %6.40 %
Allowance for loan losses ratio1.15 %1.29 %
Allowance for loan losses ratio, excluding PPP loans (1)(3)
1.17 %1.40 %
Tangible common equity ratio7.44 %7.02 %
(1) Non-GAAP financial measures - see reconciliation below
(2) A lower ratio is more desirable
(3) Paycheck Protection Program (PPP)

Definitions of ratios:
•Return on average assets - annualized net income divided by average assets.
•Return on average equity - annualized net income divided by average stockholders’ equity.
•Net interest margin - annualized tax-equivalent net interest income divided by average interest-earning assets.
•Efficiency ratio - noninterest expense (excluding other real estate owned expense) divided by noninterest income (excluding net securities gains/losses and gains/losses on disposition of premises and equipment) plus tax-equivalent net interest income.
•Texas ratio - total nonperforming assets divided by tangible common equity plus the allowance for loan losses.
•Allowance for loan losses ratio - allowance for loan losses divided by total loans.
•Allowance for loan losses ratio, excluding PPP loans - allowance for loan losses divided by total loans minus the amount of PPP loans.
•Tangible common equity ratio - common equity less intangible assets (none held) divided by tangible assets.




WEST BANCORPORATION, INC. AND SUBSIDIARY
Financial Information (continued) (unaudited)
(dollars in thousands)

NON-GAAP FINANCIAL MEASURES

This press release contains references to financial measures that are not defined in generally accepted accounting principles (GAAP). The following table reconciles the non-GAAP financial measures of net interest income and net interest margin on a fully taxable equivalent (FTE) basis, efficiency ratio on an adjusted and FTE basis, loans, net of PPP loans and allowance for loan losses ratio, excluding PPP loans, to their most directly comparable measures under GAAP.
 Three Months Ended December 31,Year Ended December 31,
2021202020212020
Reconciliation of net interest income and net interest margin on a FTE basis to GAAP:
Net interest income (GAAP)$24,602 $22,490 $95,059 $82,833 
Tax-equivalent adjustment (1)
397 191 1,202 707 
Net interest income on a FTE basis (non-GAAP)24,999 22,681 96,261 83,540 
Average interest-earning assets3,309,625 2,822,563 3,152,138 2,614,342 
Net interest margin on a FTE basis (non-GAAP)3.00 %3.20 %3.05 %3.20 %
Reconciliation of efficiency ratio on an adjusted and FTE basis to GAAP:
Net interest income on a FTE basis (non-GAAP)$24,999 $22,681 $96,261 $83,540 
Noninterest income2,348 2,104 9,729 9,602 
Adjustment for realized securities (gains) losses, net— 4 (51)(77)
Adjustment for losses on disposal of premises and equipment, net55 6 84 9 
Adjusted income27,402 24,795 106,023 93,074 
Noninterest expense11,871 9,915 43,380 39,054 
Efficiency ratio on an adjusted and FTE basis (non-GAAP) (2)
43.32 %39.99 %40.91 %41.96 %
As of December 31,
20212020
Reconciliation of allowance for loan losses ratio, excluding PPP loans:
Loans outstanding (GAAP)$2,456,196 $2,280,575 
Less: PPP loans(22,206)(180,757)
   Loans, net of PPP loans (non-GAAP) 2,433,990 2,099,818 
Allowance for loan losses28,364 29,436 
Allowance for loan losses ratio, excluding PPP loans (non-GAAP) (3)
1.17 %1.40 %

(1) Computed on a tax-equivalent basis using a federal income tax rate of 21 percent, adjusted to reflect the effect of the 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.
(3)    Management believes that presenting the allowance for loan losses as a percentage of total loans excluding PPP loans is useful in assessing the credit quality
of the Company’s core portfolio.