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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR QUARTER ENDED COMMISSION FILE NUMBER
- ----------------- ----------------------
June 30, 2003 0-49677
WEST BANCORPORATION, INC.
------------------------------------------------------
(Exact Name of Registrant as Specified in its Charter)
IOWA 42-1230603
----------------------- ------------------------------------
(State of Incorporation) (I.R.S. Employer Identification No.)
1601 22nd Street, West Des Moines, Iowa 50266
---------------------------------------------
Telephone Number (515) 222-2300
Indicate by check mark whether the registrant (1) has filed all reports required
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.
Yes [ x ] No [ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes [ x ] No [ ]
As of August 13, 2003, there were 16,060,271 shares of common stock, no par
value outstanding.
1
PART I - FINANCIAL INFORMATION
West Bancorporation, Inc. and Subsidiary
Consolidated Balance Sheets
(unaudited)
June 30, December 31,
2003 2002
------------------------------
Assets
Cash and due from banks ................................................... $ 25,564,476 $ 23,022,298
Federal funds sold and other short-term investments ....................... 68,916,380 158,191,770
------------------------------
Cash and cash equivalents ............................................. 94,480,856 181,214,068
------------------------------
Securities available for sale ............................................. 149,245,639 70,862,435
Securities held to maturity (approximate market value of $106,043,234
and $141,267,000 at June 30, 2003 and December 31, 2002, respectively) 102,766,323 138,299,566
Federal Home Loan Bank stock, at cost ..................................... 3,129,700 3,129,700
------------------------------
Total securities ...................................................... 255,141,662 212,291,701
------------------------------
Loans ..................................................................... 500,068,690 488,452,911
Allowance for loan losses ............................................. (4,796,329) (4,493,583)
------------------------------
Loans, net ................................................................ 495,272,361 483,959,328
------------------------------
Premises and equipment, net ............................................... 1,361,062 1,394,649
Accrued interest receivable ............................................... 5,333,384 5,204,203
Other assets .............................................................. 12,311,294 2,052,114
------------------------------
Total assets .......................................................... $ 863,900,619 $ 886,116,063
==============================
Liabilities and Stockholders' Equity
Deposits:
Noninterest-bearing ................................................... $ 155,297,839 $ 145,208,492
Interest-bearing:
Demand ............................................................. 37,371,926 38,240,910
Savings ............................................................ 280,330,844 300,534,634
Time, in excess of $100,000 ........................................ 47,162,319 88,592,994
Other time ......................................................... 38,264,687 40,521,470
------------------------------
Total deposits ........................................................ 558,427,615 613,098,500
Federal funds purchased and securities sold under agreements to repurchase 159,739,073 127,418,671
Other short-term borrowings ............................................... 1,946,723 5,096,872
Accrued expnses and other liabilities ..................................... 2,552,302 3,077,858
Long-term borrowings ...................................................... 51,600,000 51,600,000
------------------------------
Total liabilities ..................................................... 774,265,713 800,291,901
------------------------------
Stockholders' Equity
Common stock, no par value; authorized 50,000,000 shares; shares issued and
outstanding: 2003 and 2002, 16,060,271 ................................ 3,000,000 3,000,000
Additional paid-in capital ................................................ 32,000,000 32,000,000
Retained earnings ......................................................... 52,954,856 49,792,716
Accumulated other comprehensive income .................................... 1,680,050 1,031,446
------------------------------
Total stockholders' equity ............................................ 89,634,906 85,824,162
------------------------------
Total liabilities and stockholders' equity ............................ $ 863,900,619 $ 886,116,063
==============================
See accompanying notes to consolidated financial statements.
2
West Bancorporation, Inc. and Subsidiary
Consolidated Statements of Income
(unaudited)
Three Months Ended June 30, Six Months Ended June 30,
--------------------------- -------------------------
2003 2002 2003 2002
------------------------------------------------------
Interest income:
Loans ........................................................ $ 7,667,478 $ 8,307,961 $15,369,314 $16,561,231
Securities:
U.S Treasury, government agencies and corporations ......... 1,087,784 1,907,876 2,262,832 3,489,564
States and political subdivisions .......................... 444,095 408,968 859,337 840,114
Other ...................................................... 761,521 279,884 1,403,510 541,016
Federal funds sold and other short-term investments .......... 379,187 359,557 818,680 862,228
-----------------------------------------------------
Total interest income ................................... 10,340,065 11,264,246 20,713,673 22,294,153
-----------------------------------------------------
Interest expense:
Demand deposits .............................................. 24,014 34,336 49,275 67,583
Savings deposits ............................................. 725,172 932,876 1,493,869 1,931,710
Time deposits ................................................ 704,608 1,358,877 1,520,668 2,703,805
Federal funds purchased and securities sold under
agreements to repurchase ................................... 492,194 435,110 888,351 967,016
Other short-term borrowings .................................. 1,782 4,206 3,357 16,384
Long-term borrowings ......................................... 715,907 715,907 1,423,947 1,403,661
-----------------------------------------------------
Total interest expense .................................. 2,663,677 3,481,312 5,379,467 7,090,159
-----------------------------------------------------
Net interest income ..................................... 7,676,388 7,782,934 15,334,206 15,203,994
Provision for loan losses ........................................ 175,000 230,000 375,000 460,000
-----------------------------------------------------
Net interest income after provision for loan losses ..... 7,501,388 7,552,934 14,959,206 14,743,994
-----------------------------------------------------
Noninterest income:
Service charges on deposit accounts .......................... 1,221,683 1,115,116 2,277,876 2,118,736
Trust services ............................................... 122,000 141,657 254,000 299,634
Net realized gains from sales of securities available for sale 95,867 -- 195,607 --
Other income ................................................. 499,483 318,008 915,972 642,227
-----------------------------------------------------
Total noninterest income ................................ 1,939,033 1,574,781 3,643,455 3,060,597
----------------------------------------------------
Noninterest expense:
Salaries and employee benefits ............................... 1,707,443 1,615,329 3,426,720 3,199,812
Occupancy expenses ........................................... 352,874 320,184 723,123 638,718
Data processing expenses ..................................... 248,889 265,519 492,174 530,342
Other expenses ............................................... 568,963 700,457 1,142,257 1,306,851
-----------------------------------------------------
Total noninterest expense ............................... 2,878,169 2,901,489 5,784,274 5,675,723
-----------------------------------------------------
Income before income taxes .............................. 6,562,252 6,226,226 12,818,387 12,128,868
Income taxes ..................................................... 2,311,391 2,217,299 4,516,961 4,300,640
-----------------------------------------------------
Net income .............................................. $ 4,250,861 $ 4,008,927 $ 8,301,426 $ 7,828,228
=====================================================
Basic earnings per share ......................................... $ 0.26 $ 0.25 $ 0.52 $ 0.49
=====================================================
Cash dividends per share ......................................... $ 0.16 $ 0.15 $ 0.32 $ 0.30
=====================================================
See accompanying notes to consolidated financial statements.
3
West Bancorporation, Inc. and Subsidiary
Consolidated Statements of Stockholders' Equity
(unaudited)
Six Months Ended June 30,
2003 2002
----------------------------
Common Stock
Beginning of year balance ........................... $ 3,000,000 $ 3,000,000
----------------------------
End of period balance ............................... 3,000,000 3,000,000
----------------------------
Additional Paid-in Capital
Beginning of year balance ........................... 32,000,000 32,000,000
----------------------------
End of period balance ............................... 32,000,000 32,000,000
----------------------------
Retained Earnings
Beginning of year balance ........................... 49,792,716 43,374,281
Net income .......................................... 8,301,426 7,828,228
Dividends on common stock ........................... (5,139,286) (4,818,082)
----------------------------
End of period balance ............................... 52,954,856 46,384,427
----------------------------
Accumulated Other Comprehensive Income (Loss)
Beginning of year balance ........................... 1,031,446 637,980
Unrealized gain on securities, net of tax ........... 648,604 184,808
----------------------------
End of period balance ............................... 1,680,050 822,788
----------------------------
Total Stockholders' Equity .............................. $ 89,634,906 $ 82,207,215
============================
4
West Bancorporation, Inc. and Subsidiary
Consolidated Statements of Comprehensive Income (Loss)
(Unaudited)
Six Months Ended June 30,
2003 2002
----------------------------
Net Income .............................................. $ 8,301,426 $ 7,828,228
Other comprehensive income, unrealized gains on
securities, net of reclassification adjustment,
net of tax .......................................... 648,604 184,808
----------------------------
Comprehensive income .................................... $ 8,950,030 $ 8,013,036
============================
See accompanying notes to consolidated financial statements.
5
West Bancorporation, Inc. and Subsidiary
Consolidated Statements of Cash Flows
(unaudited)
Six Months Ended June 30,
2003 2002
------------------------------
Cash Flows from Operating Activities
Net income ................................................................ $ 8,301,426 $ 7,828,228
Adjustments to reconcile net income to net cash provided by
operating activities:
Provision for loan losses .............................................. 375,000 460,000
Net amortization ....................................................... 677,677 304,441
Net gains from sales of securities available for sale
and loans held for sale ............................................. (319,344) (63,341)
Loss on disposition of fixed assets .................................... -- 28,665
Proceeds from sales of loans held for sale ............................. 4,991,669 5,041,456
Originations of loans held for sale .................................... (4,989,182) (4,767,670)
Depreciation ........................................................... 106,775 72,785
Deferred income taxes .................................................. (394,254) (113,285)
Change in assets and liabilities:
Increase in accrued interest receivable ............................. (129,181) (490,061)
Decrease in accrued expenses and other liabilities .................. (525,556) (1,285,932)
------------------------------
Net cash provided by operating activities ........................ 8,095,030 7,015,286
------------------------------
Cash Flows from Investing Activities
Proceeds from sales, calls, and maturities of securities available for sale 17,746,751 2,018,838
Purchases of securities available for sale ................................ (95,463,237) (17,199,653)
Proceeds from calls and maturities of securities held to maturity ......... 49,857,843 59,037,775
Purchases of securities held to maturity .................................. (14,414,620) (73,708,976)
Net (increase) decrease in loans .......................................... (11,566,783) 12,752,917
Purchases of bank premises and equipment .................................. (73,188) (259,312)
Purchase of bank-owned life insurance ..................................... (10,000,000) --
Change in other assets .................................................... (275,090) 347,180
------------------------------
Net cash used in investing activities ............................ (64,188,324) (17,011,231)
------------------------------
Cash Flows from Financing Activities
Net decrease in deposits .................................................. (54,670,885) (1,220,812)
Net increase (decrease) in federal funds purchased and securities sold
under agreements to repurchase ......................................... 32,320,402 (2,909,467)
Net decrease in other short-term borrowings ............................... (3,150,149) (1,411,291)
Proceeds from long-term borrowings ........................................ -- 3,600,000
Cash dividends ............................................................ (5,139,286) (4,818,082)
------------------------------
Net cash used in financing activities ............................ (30,639,918) (6,759,652)
------------------------------
Net decrease in cash and cash equivalents ........................ (86,733,212) (16,755,597)
Cash and Cash Equivalents
Beginning ................................................................. 181,214,068 128,450,240
------------------------------
End ....................................................................... $ 94,480,856 $ 111,694,643
==============================
Supplemental Disclosures of Cash Flow Information
Cash payments for:
Interest ............................................................... $ 5,901,782 $ 7,822,835
Income taxes ........................................................... 4,868,603 4,692,710
See accompanying notes to consolidated financial statements.
6
West Bancorporation, Inc.
Notes to Consolidated Financial Statements
(unaudited)
- --------------------------------------------------------------------------------
1. Basis of Presentation
The accompanying consolidated statements of income, stockholders' equity,
comprehensive income, and cash flows for the three and six months ended June 30,
2003 and 2002, and the consolidated balance sheets as of June 30, 2003 and
December 31, 2002 include the accounts and transactions of the Company and its
wholly-owned subsidiary, West Des Moines State Bank. All material intercompany
balances and transactions have been eliminated in consolidation.
The accompanying consolidated financial statements have been prepared by the
Company pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations. Although management believes that the disclosures are adequate to
make the information presented not misleading, it is suggested that these
interim consolidated financial statements be read in conjunction with the
Company's most recent audited financial statements and notes thereto. In the
opinion of management, the accompanying consolidated financial statements
contain all adjustments (consisting of only normal recurring accruals) necessary
to present fairly the financial position as of June 30, 2003, and the results of
operations and cash flows for the three and six months ended June 30, 2003 and
2002.
The results for these interim periods may not be indicative of results for the
entire year or for any other period.
2. Earnings Per Common Share
Earnings per share represent income available to common shareholders divided by
the weighted average number of shares outstanding during the period. The Company
has no common equivalent shares that could cause dilution. The average number of
shares outstanding for the three and six months ended June 30, 2003 and 2002 was
16,060,271.
3. Commitments
In the normal course of business, the Company enters into a number of
off-balance sheet commitments. These commitments expose the Company to varying
degrees of credit and market risk and are subject to the same credit reviews as
those recorded on the balance sheet.
The Company enters into commitments to extend credit such as loan commitments
and standby letters of credit to meet the financing needs of its customers. For
additional information on credit extension commitments see Note 10 of the
Company's 2002 consolidated financial statements. The Company's commitments as
of June 30, 2003 and December 31, 2002 are approximately as follows:
June 30, December 31,
2003 2002
-------------------------------
Commitments to extend credit ............. $130,392,000 $136,434,000
Standby letters of credit ................ 17,247,000 15,804,000
-------------------------------
$147,639,000 $152,238,000
===============================
4. Impact of New Financial Accounting Standards
In January 2003, the Financial Accounting Standards Board (FASB) issued
Interpretation No. 46 ("FIN 46)", "Consolidated Variable Interest Entities." The
objective of this Interpretation is to provide guidance on how to identify a
variable interest entity and determine when the assets, liabilities,
non-controlling interests, and results of operations of a variable interest in
an entity need to be included in a company's consolidated financial statements.
A company that holds variable interests in an entity will need to consolidate
the entity if the company's interest in the variable interest entity is such
that the company will absorb a majority of the variable interest entity's losses
and/or receive a majority of the entity's expected residual returns, if they
occur. FIN 46 also requires additional disclosures by primary beneficiaries and
other significant variable interest holders. The provisions of this
interpretation are effective upon issuance. The Company is not impacted by the
provisions of FIN 46.
7
In May 2003, the FASB issued SFAS 150, "Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity." SFAS 150
requires issuers to classify as liabilities (or assets in some circumstances)
three classes of freestanding financial instruments that embody obligations for
the issuer. Generally, the statement is effective for financial instrucments
entered into or modified after May 31, 2003 and is otherwise effective at the
beginning of the first interim period beginning after June 15, 2003. The Company
does not anticipate that SFAS 150 will have a material impact to the Company's
consolidated financial statements.
In December 2002, the FASB issued SFAS No, 148, "Accounting for Stock-Based
Compensation - Transition and Disclosures - an amendment of SFAS 123" ("SFAS
148"). SFAS 148 permits two additional transition methods for entities that
adopt the fair value based method of accounting for stock-based employee
compensation. Since the Company does not have any stock based compensation
plans, this pronouncement does not have any effect on the Company.
In April 2003, the FASB issued Statement No. 149, "Amendment of Statement No.
133, Accounting for Derivative Instruments and Hedging Activities." This
statement clarifies the definition of a derivative and incorporates certain
decisions made by the Board as part of the Derivatives Implementation Group
process. This statement is effective for contracts entered into or modified, and
for hedging relationships designated after June 30, 2003 and should be applied
prospectively. The Company is not impacted by this Statement.
5. Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reported period. Actual
results could differ from those estimates. A significant estimate that is
particularly sensitive to change is the allowance for loan losses.
6. Critical Accounting Policies
Management has identified its most critical accounting policy to be that related
to the allowance for loan losses. The allowance for loan losses is established
through a provision for loan losses charged to expense. Loans are charged
against the allowance for loan losses when management believes that
collectibility of the principal is unlikely. The Company has policies and
procedures for evaluating the overall credit quality of its loan portfolio
including timely identification of potential problem credits. On a quarterly
basis, management reviews the appropriate level for the allowance for loan
losses incorporating a variety of risk considerations, both quantitative and
qualitative. Quantitative factors include the Company's historical loss
experience, delinquency and charge-off trends, collateral values, known
information about individual loans and other factors. Qualitative factors
include the general economic environment in the Company's market area and the
expected trend of those economic conditions. To the extent actual results differ
from forecasts and management's judgment, the allowance for loan losses may be
greater or less than future charge-offs.
7. Acquisition Subsequent to June 30, 2003
On July 18, 2003, the Company closed its previously announced acquisition of
Hawkeye State Bank in Iowa City, Iowa. Hawkeye State Bank has assets of
approximately $135,000,000 with deposits of approximately $95,000,000 with two
locations in Iowa City, Iowa. After this acquisition, total assets of West Bank
are approximately $1 billion.
The purchase price of approximately $35 million was financed by using invested
cash and by issuing $20,000,000 in long-term subordinated debt through a pooled
trust preferred security. This security is a hybrid capital instrument that is
included as Tier 1 capital for regulatory purposes (subject to limitations), yet
is non-dilutive to common shareholders and to return on equity. The trust
preferred security has a 30 year maturity, does not require any principal
amortization and is callable in seven years at par at the Company's option. The
interest rate is fixed for seven years at 6.975% and then becomes variable at
305 basis points over the 90 day LIBOR rate. Interest is payable quarterly.
See the section entitled "Capital Resources" in Item 2 - Management's Discussion
and Analysis of Financial Condition and Results of Operations for a discussion
of the effect of the acquisition of Hawkeye State Bank on the Company's capital
ratios.
8
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
Certain statements in this report including any discussion of management's
expectations for future periods (such as those relating to the Company's growth
and acquisition strategies, new products and services, and future financial
performance), constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such forward-looking
information is based upon certain underlying assumptions, risks and
uncertainties. Because of the possibility of change in the underlying
assumptions, actual results could differ materially from the future results
expressed or implied by these forward-looking statements. Factors that may
affect future results include: pricing pressures on loans and deposits, actions
of bank and non-bank competitors, changes in local and national economic
conditions, changes in regulatory requirements, actions of the Federal Reserve
Board, and customer's acceptance of the Company's products and services. The
Company undertakes no obligation to revise or update any such forward-looking
statements to reflect current events or circumstances after the date hereof or
to reflect the occurrence of unanticipated events.
THREE AND SIX MONTHS ENDED JUNE 30, 2003
SELECTED FINANCIAL RESULTS
The following table shows selected financial results and measures for the three
and six months ended June 30, 2003 compared with the same periods in 2002.
Three months ended June 30, Six months ended June 30,
---------------------------------------------------- ---------------------------------------------------
2003 2002 Change Change-% 2003 2002 Change Change-%
---------------------------------------------------------------------------------------------------------
Net income ........... $ 4,250,861 $ 4,008,927 $ 241,934 6.0% $ 8,301,426 $ 7,828,228 $ 473,198 6.0%
Average assets ....... 888,654,683 817,776,423 70,878,260 8.7% 878,079,008 821,292,898 56,786,110 6.9%
Average stockholders'
equity ............ 88,095,649 80,734,858 7,360,791 9.1% 87,250,509 80,132,153 7,118,356 8.9%
Return on assets ..... 1.92% 1.97% -0.05% -2.4% 1.91% 1.92% -0.02% -0.8%
Return on equity ..... 19.35% 19.92% -0.56% -2.8% 19.19% 19.70% -0.51% -2.6%
Efficiency ratio ..... 29.54% 30.23% -0.69% -2.3% 30.05% 30.26% -0.21% -0.7%
Dividend payout ratio 61.54% 60.00% 1.54% 2.6% 61.54% 61.22% 0.31% 0.5%
Equity to assets ratio 9.91% 9.87% 0.04% 0.4% 9.94% 9.76% 0.18% 1.8%
Definitions of ratios:
Return on assets - annualized net income divided by average assets.
Return on equity - annualized net income divided by average stockholders'
equity.
Efficiency ratio - noninterest expense divided by noninterest income (excluding
securities gains) plus taxable equivalent net interest income.
Dividend payout ratio - dividends per share divided by net income per share.
Equity to assets ratio - average equity divided by average assets.
RESULTS OF OPERATIONS
Net income for the first half of 2003 is higher than the previous year primarily
because of new sources of noninterest income and gains from securities available
for sale.
Net Interest Income
The following tables show average balances and related interest income or
interest expense, with the resulting average yield or rate by category of
average earning assets or interest bearing liability. Interest income and the
resulting net interest income are shown on a fully taxable basis.
9
Data for the three months ended June 30 (dollars in thousands):
Average Balance Interest Income/Expense Yield/Rate
--------------------------------------- ------------------------------------- ----------------------
2003 2002 Change Change-% 2003 2002 Change Change-% 2003 2002 Change
--------------------------------------------------------------------------------------------------------
Interest-earning assets:
Loans:
Commercial .......... $257,719 $247,430 $10,289 4.16% $ 3,614 $ 3,835 $ (221) -5.76% 5.62% 6.22% -0.60%
Real estate ......... 207,366 193,602 13,764 7.11% 3,597 3,828 (231) -6.03% 6.96% 7.93% -0.97%
Consumer ............ 17,088 21,853 (4,765) -21.80% 328 431 (103) -23.90% 7.70% 7.91% -0.21%
Other ............... 9,702 15,866 (6,164) -38.85% 188 308 (120) -39.04% 7.77% 7.80% -0.03%
--------------------------------------------------------------------------------------------------------
Total Loans ..... 491,875 478,751 13,124 2.74% 7,727 8,402 (675) -8.04% 6.30% 7.04% -0.74%
--------------------------------------------------------------------------------------------------------
Investment securities:
Taxable ............... 193,743 196,560 (2,817) -1.43% 1,933 2,272 (339) -14.94% 4.00% 4.64% -0.64%
Tax-exempt ............ 41,789 28,236 13,553 48.00% 524 469 55 11.70% 5.03% 6.67% -1.64%
--------------------------------------------------------------------------------------------------------
Total investment
securities ...... 235,532 224,796 10,736 4.78% 2,457 2,741 (284) -10.38% 4.18% 4.89% -0.71%
--------------------------------------------------------------------------------------------------------
Federal funds sold and
short-term investments 122,737 80,390 42,347 52.68% 379 360 19 5.41% 1.24% 1.79% -0.56%
--------------------------------------------------------------------------------------------------------
Total interest-
earning assets .. $850,144 $783,937 $66,207 8.45% 10,563 11,503 (940) -8.18% 4.98% 5.89% -0.90%
========================================================================================================
Interest-bearing
liabilities:
Deposits:
Checking with interest,
savings and money
markets ............. $322,853 $279,699 $43,154 15.43% $ 749 $ 967 (218) -22.52% 0.93% 1.39% -0.46%
Time deposits ......... 103,346 149,442 (46,096) -30.85% 705 1,359 (654) -48.15% 2.73% 3.65% -0.92%
--------------------------------------------------------------------------------------------------------
Total deposits .......... 426,199 429,141 (2,942) -0.69% 1,454 2,326 (872) -37.49% 1.37% 2.17% -0.80%
--------------------------------------------------------------------------------------------------------
Other borrowed funds .... 231,540 164,093 67,447 41.10% 1,210 1,155 55 4.73% 2.10% 2.82% -0.72%
--------------------------------------------------------------------------------------------------------
Total interest-bearing
liabilities ........... $657,739 $593,234 $64,505 10.87% 2,664 3,481 (817) -23.48% 1.62% 2.35% -0.73%
=======================================-----------------------------------------------------------------
Tax-equivalent net
interest income $ 7,899 $ 8,022 $ (123) -1.53%
=====================================
Net interest spread ..... 3.36% 3.53% -0.17%
======================
Net interest margin ..... 3.73% 4.10% -0.37%
======================
10
Data for the six months ended June 30 (dollars in thousands):
Average Balance Interest Income/Expense Yield/Rate
--------------------------------------- ------------------------------------- ----------------------
2003 2002 Change Change-% 2003 2002 Change Change-% 2003 2002 Change
--------------------------------------------------------------------------------------------------------
Interest-earning assets:
Loans:
Commercial .......... $254,389 $248,815 $ 5,574 2.24% $ 7,165 $ 7,582 $ (417) -5.50% 5.68% 6.14% -0.46%
Real estate ......... 202,482 195,751 6,731 3.44% 7,192 7,703 (511) -6.63% 7.16% 7.94% -0.77%
Consumer ............ 18,324 20,679 (2,355) -11.39% 689 846 (157) -18.56% 7.58% 8.25% -0.67%
Other ............... 12,054 15,968 (3,914) -24.51% 472 621 (149) -23.99% 7.90% 7.84% 0.05%
--------------------------------------------------------------------------------------------------------
Total Loans ..... 487,249 481,213 6,036 1.25% 15,518 16,752 (1,234) -7.36% 6.42% 7.02% -0.60%
--------------------------------------------------------------------------------------------------------
Investment securities:
Taxable ............... 185,348 179,770 5,578 3.10% 3,834 4,199 (365) -8.70% 4.17% 4.71% -0.54%
Tax-exempt ............ 37,253 28,895 8,358 28.92% 1,009 970 39 3.99% 5.46% 6.77% -1.31%
--------------------------------------------------------------------------------------------------------
Total investment
securities ...... 222,601 208,665 13,936 6.68% 4,843 5,169 (326) -6.30% 4.39% 5.00% -0.61%
--------------------------------------------------------------------------------------------------------
Federal funds sold and
short-term investments 132,675 97,638 35,037 35.89% 819 862 (44) -5.05% 1.24% 1.78 -0.54%
--------------------------------------------------------------------------------------------------------
Total interest-
earning assets .. $842,525 $787,516 $55,009 6.99% 21,180 22,783 (1,603) -7.03% 5.07% 5.83% -0.76%
=======================================-----------------------------------------------------------------
Interest-bearing
liabilities:
Deposits:
Checking with interest,
savings and money
markets ........... $325,670 $276,750 $48,920 17.68% $ 1,543 $ 2,000 (457) -22.84% 0.96% 1.46% -0.50%
Time deposits ....... 109,743 142,488 (32,745) -22.98% 1,521 2,704 (1,183) -43.76% 2.79% 3.83% -1.03%
--------------------------------------------------------------------------------------------------------
Total deposits .. 435,413 419,238 16,175 3.86% 3,064 4,704 (1,640) -34.86% 1.42% 2.26% -0.84%
--------------------------------------------------------------------------------------------------------
Other borrowed funds .... 215,532 178,452 37,080 20.78% 2,316 2,387 (71) -2.97% 2.17% 2.70% -0.53%
--------------------------------------------------------------------------------------------------------
Total interest-
bearing
liabilities ..... $650,945 $597,690 $53,255 8.91% 5,380 7,091 (1,711) -24.13% 1.67% 2.39% -0.73%
=======================================-----------------------------------------------------------------
Tax-equivalent net
interest income ....... $15,800 $15,692 $ 108 0.69%
=====================================
Net interest spread ..... 3.40% 3.44% -0.04%
======================
Net interest margin ..... 3.78% 4.02% -0.24%
======================
Net interest income is computed by subtracting total interest expense from total
interest income. Fluctuations in net interest income can result from the changes
in the volumes of assets and liabilities as well as changes in interest rates.
Net interest margin is a measure of the net return on interest-earning assets
and is computed by dividing annualized net interest income by the average of
total interest-earning assets for the period. The Federal Reserve lowered the
targeted fed funds rate by 50 basis points in November 2002 and by 25 basis
points in June 2003. As a result, the prime rate and fed funds rate are 75 basis
points lower than they were in the first six months of last year. The Company's
tax-equivalent net interest income for the six months ended June 30, 2003
increased $108,000 compared to the six months ended June 30, 2002. The increase
is attributable to an increase in the volume of earning assets.
Taxable-equivalent interest income and fees on loans decreased $1,234,000 in the
first six months of 2003 compared to the same period in 2002, due to lower
interest rates on loans. The average yield on loans decreased to 6.42 percent
for the first six months of 2003, compared to 7.02 percent for the same period
in 2002. The yield on the Company's loan portfolio is affected by the amount of
nonaccrual loans, the mix of the portfolio, the effects of competition and the
interest rate environment. The interest rate environment can influence the
volume of new loan originations and the mix of variable rate versus fixed rate
loans. Competition for loans in the market area served by the Company remains
strong as customers seek to refinance loans to obtain lower interest rates.
11
The average balance of investment securities was $13.9 million higher than last
year while the yield has declined 61 basis points. The mix of investment
securities has been changed to result in a higher percentage of the portfolio
invested in corporate bonds. The Company has purchased corporate bonds with a
maturity generally less than 2 1/2 years and a credit rating of BBB+ or better.
As of June 30, 2003, corporate bonds in the investment portfolio totaled
approximately $79 million, with a weighted average yield of 3.37 percent and a
weighted average maturity of 1.4 years.
The average rate paid on deposits declined to 1.42 percent from 2.26 percent for
the first six months of 2002. This decline is the result of a decrease in market
interest rates and a change in the mix of deposits. Compared to the first six
months of last year, the average balance of higher rate certificates of deposit
was down $32.7 million, while the average balance of money market and savings
accounts, which typically have lower rates, was $48.9 million higher.
The average balance of borrowings for the first six months of 2003 was $37.1
million higher than a year ago. The increase is attributable to higher balances
in fed funds purchased from downstream correspondent banks.
Provision for Loan Losses and the Related Allowance for Loan Losses
The following table sets forth the activity in the Allowance for Loan Losses for
the three and six months ended June 30, 2003 and the same respective periods for
2002 as well as common ratios related to the allowance for loan losses.
Three months ended June 30, Six months ended June 30,
--------------------------------------- ----------------------------------------
2003 2002 Change 2003 2002 Change
----------------------------------------------------------------------------------
Balance at beginning of period ....... $ 4,615,248 $ 4,339,811 $ 275,437 $ 4,493,583 $ 4,239,990 $ 253,593
Charge-offs .......................... (37,728) (251,819) 214,091 (160,681) (392,294) 231,613
Recoveries ........................... 43,809 157,608 (113,799) 88,427 167,904 (79,477)
----------------------------------------------------------------------------------
Net charge-offs .............. 6,081 (94,211) 100,292 (72,254) (224,390) 152,136
Provision charged to operations ...... 175,000 230,000 (55,000) 375,000 460,000 (85,000)
----------------------------------------------------------------------------------
Balance at end of period ..... $ 4,796,329 $ 4,475,600 $ 320,729 $ 4,796,329 $ 4,475,600 $ 320,729
==================================================================================
Average loans outstanding ............ $491,875,695 $478,853,422 $487,248,274 $481,212,854
Ratio of net charge-offs during the
period to average loans outstanding 0.00% 0.02% 0.01% 0.05%
Ratio of allowance for loan losses
to average loans outstanding ...... 0.98% 0.93% 0.98% 0.93%
Management determines an appropriate provision based on its evaluation of the
adequacy of the allowance for loan losses in relationship to a continuing review
of problem loans, the current economic conditions and industry trends in
addition to the actual loss experience. The allowance for loan losses is
management's best estimate of probable losses inherent in the loan portfolio as
of the balance sheet date; however, changes in the loan portfolio and the
uncertainty of the general economy require that management continue to evaluate
the adequacy of the allowance for loan losses and make additional provisions in
future periods as deemed necessary.
12
Noninterest Income
The following table shows the variance from the prior year in the noninterest
income categories shown in the Consolidated Statements of Income. In addition,
accounts within the Other Income category that represent significant variances
are shown.
Three months ended June 30, Six months ended June 30,
----------------------------------------------- -------------------------------------------
2003 2002 Change Change-% 2003 2002 Change Change-%
--------------------------------------------------------------------------------------------
Noninterest income
Service charges on deposit
accounts ........................ $1,221,683 $1,115,116 $ 106,567 9.56% $2,277,876 $2,118,736 $159,140 7.51%
Trust services .................... 122,000 141,657 (19,657) -13.88% 254,000 299,634 (45,634) -15.23%
Other:
Letter of credit fees ........... 19,536 11,012 8,524 77.41% 34,115 42,996 (8,881) -20.66%
VISA/Mastercard income .......... 36,197 51,632 (15,435) -29.89% 74,445 101,032 (26,587) -26.32%
Gain on sale of real estate loan 41,869 28,440 13,429 47.22% 84,759 63,341 21,418 33.81%
Debit card income ............... 29,450 20,200 9,250 45.79% 66,332 40,131 26,201 65.29%
ATM surcharge fees .............. 27,234 6,534 20,700 316.80% 56,029 6,534 49,495 757.50%
Increase in cash value of bank
owned life insurance .......... 126,701 -- 126,701 -- 191,347 -- 191,347 --
All other ....................... 218,496 200,189 18,307 9.14% 408,945 388,193 20,752 5.35%
--------------------------------------------------------------------------------------------
Total other ................. 499,483 318,007 181,476 57.07% 915,972 642,227 273,745 42.62%
--------------------------------------------------------------------------------------------
Gain on sale of securities ........ 95,867 -- 95,867 -- 195,607 -- 195,607 --
--------------------------------------------------------------------------------------------
Total noninterest income .... $1,939,033 $1,574,780 $ 364,253 23.13% $3,643,455 $3,060,597 $582,858 19.04%
============================================================================================
Noninterest income results from the charges and fees collected by the Company
from its customers for various services performed and miscellaneous other income
and gains (or losses) from the sale of investment securities held in the
available for sale category. Service charges on deposit accounts grew due to
higher volumes and an increase in nonsufficient funds fees. Income from trust
services was down due to a decrease in the number of trust accounts and a
decline in asset values under management as a result of market conditions. The
gain on the sale of real estate loans is higher this year because of an increase
in the premium paid for these loans. The decline in VISA/Mastercard income was
due to reduced retail activity at the Bank's merchant customers. Debit card
income is up because of increased promotion of debit cards to the Bank's
customer base. ATM surcharge fees were not implemented until the second quarter
of 2002. Bank-owned life insurance was purchased during the first quarter of
this year.
Noninterest Expense
The following table shows the variance from the prior year in the noninterest
expense categories shown in the Consolidated Statements of Income. In addition,
accounts within the Other expense category that represent significant variances
are shown.
Three months ended June 30, Six months ended June 30,
----------------------------------------------- -------------------------------------------
2003 2002 Change Change-% 2003 2002 Change Change-%
--------------------------------------------------------------------------------------------
Noninterest expense:
Salaries and employee benefits ... $1,707,443 $1,615,329 $ 92,114 5.70% $3,426,720 $3,199,812 $ 226,908 7.09%
Occupancy expenses ............... 352,874 320,184 32,690 10.21% 723,123 638,718 84,405 13.21%
Data processing expenses ......... 248,889 265,519 (16,630) -6.26% 492,174 530,342 (38,168) -7.20%
Other:
Miscellaneous losses ........... 22,348 51,289 (28,941) -56.43% 34,788 118,425 (83,637) -70.62%
Advertising .................... 49,962 67,900 (17,938) -26.42% 97,804 108,005 (10,201) -9.44%
Trust expense .................. 58,497 73,698 (15,201) -20.63% 118,660 151,296 (32,636) -21.57%
Professional fees .............. 68,448 76,679 (8,231) -10.73% 158,724 155,487 3,237 2.08%
All other ...................... 369,708 430,891 (61,183) -14.20% 732,281 773,638 (41,357) -5.35%
--------------------------------------------------------------------------------------------
Total other ................ 568,963 700,457 (131,494) -18.77% 1,142,257 1,306,851 (164,594) -12.59%
--------------------------------------------------------------------------------------------
Total noninterest expense .. $2,878,169 $2,901,489 $ (23,320) -0.80% $5,784,274 $5,675,723 $ 108,551 1.91%
============================================================================================
13
The year-to-date increase in salaries and benefits includes one-time relocation
expenses for the Company's newly hired chief executive officer totaling $52,500.
Without those expenses, salaries and employee benefits expense for the first six
months of 2003 would have increased 5.5 percent over the same period last year.
Occupancy expenses were higher this year due to increased lease payments at the
main bank location, higher maintenance costs due to snow removal and increased
depreciation expense related to technology purchases. Miscellaneous losses were
significantly lower as the first quarter of 2002 included a higher level of
losses from forged and fraudulently deposited checks. Also, the second quarter
of 2002 included a loss of approximately $29,000 on the disposition of personal
computers that were replaced in order to run updated software programs. Trust
expenses have declined because of the loss of a large custodial account and
lower investment management fees.
Income Tax Expense
The Company incurred income tax expense of $4,516,961 for the six months ended
June 30, 2003 compared to $4,300,640 for the six months ended June 30, 2002. The
effective income tax rate as a percent of income before taxes for the three and
six months ended June 30, 2003 was 35.2 percent, compared to 35.6 percent and
35.5 percent, respectively, for the same periods last year.
FINANCIAL CONDITION
Total assets as of June 30, 2003 were $863,901,000, a slight decrease from
$886,116,000 at December 31, 2002.
Investment Securities
Investment securities available for sale increased $78,383,000 from December 31,
2002 to $149,246,000. Since December 31, 2002, investment securities classified
as held to maturity declined $35,533,000 to $102,766,000 as of June 30, 2003.
The increase in the available for sale category was accomplished to allow for
increased liquidity and flexibility. Corporate bonds which have been purchased
over the past six months have been classified as available for sale.
Loans
Loans outstanding increased $11,616,000 from December 31, 2002 to June 30, 2003.
The increase was primarily attributable to growth in commercial and real estate
loans.
Deposits
Total deposits as of June 30, 2003 were $558,428,000 compared with $613,099,000
as of December 31, 2002. Savings accounts were $20,204,000 lower at June 30,
2003 than at December 31, 2002. The balance was somewhat higher than normal at
December 31, 2002. Noninterest bearing deposits at June 30, 2003 were
$10,089,000 higher than at December 31, 2002. It is not unusual to see this kind
of fluctuation at any given point in time. Certificates of deposit as of June
30, 2003 were $85,427,000, down $43,687,000 from December 31, 2002. That decline
is primarily in large certificates of deposit, $100,000 and over. The Company
has chosen to not bid as aggressively for these deposits as have some
competitors.
Borrowings
The balance of federal funds purchased and securities sold under agreement to
repurchase was $159,739,000 at June 30, 2003, up from $127,419,000 at December
31, 2002. Most of this increase relates to federal funds purchased, which are
federal funds sold to West Bank by approximately 40 banks throughout Iowa. This
is a correspondent bank service provided by West Bank. Federal funds sold to
West Bank by these downstream correspondent banks are invested in federal funds
sold to upstream correspondent banks or other short-term investments. The
balance of other short-term borrowings consisted entirely of Treasury, Tax and
Loan option notes at June 30, 2003 and December 31, 2002.
14
Nonperforming Assets
The following table sets forth the amount of non-performing loans and assets
carried by the Company and common ratio measurements of those item (dollars in
thousands).
June 30, December 31,
2003 2002 Change
--------------------------------
Nonaccrual loans ........................... $ 385 $1,354 $ (969)
Loans past due 90 days and still
accruing interest ........................ $1,167 $ 545 622
-------------------------------
Total non-performing loans ................. $1,552 $1,899 $ (347)
Other real estate owned .................... 522 529 (7)
-------------------------------
Total non-performing assets ................ $2,074 $2,428 $ (354)
===============================
Non-performing assets to total loans ....... 0.41% 0.50% -0.08%
Non-performing assets to total assets ...... 0.24% 0.27% -0.03%
The reduction in nonaccrual loans is primarily the result of the resolution of a
commercial real estate loan. In the opinion of management, loans past due 90
days and still accruing interest are adequately collateralized to cover any
unpaid interest.
Reference is also made to the information and discussion earlier in this report
under the heading of "Provision for Loan Losses and the Related Allowance for
Loan Losses".
Capital Resources
Total stockholders' equity was 10.4 percent of total assets as of June 30, 2003
and 9.7 percent on December 31, 2002.
The table below shows the various measures of regulatory capital and related
ratios.
June 30, 2003 December 31, 2002
--------------------------------
Total stockholders' equity ................... $ 89,634,906 $ 85,824,162
Less: net unrealized gains on available
for sale securities ........................ (1,680,050) (1,031,446)
Less: intangible assets ...................... (31,820) (47,730)
----------------------------
Tier 1 capital ....................... 87,923,036 84,744,986
Plus: allowance for loan losses .............. 4,796,329 4,493,583
----------------------------
Total risk-based capital ............. $ 92,719,365 $ 89,238,569
============================
Regulatory requirements to be:
Adequately Well- Actual Regulatory Capital Ratios as of:
Capitalized Capitalized June 30, 2003 December 31, 2002
-----------------------------------------------------------------------
Total risk-based capital as % of risk-weighted assets 8.0% 10.0% 13.6% 13.8%
Tier 1 capital as % of risk-weighted assets ......... 4.0% 6.0% 12.9% 13.1%
Tier 1 capital as % average assets .................. 4.0% 5.0% 9.9% 9.7%
Risk-based capital guidelines require the classification of assets and some
off-balance items in terms of credit-risk exposure and the measuring of capital
as a percentage of the risk adjusted asset totals. Management believes, and data
in the above table show that, as of June 30, 2003 and December 31, 2002, the
Company met all capital adequacy requirements to which it is subject. As of
those dates, West Bank was "well capitalized" under regulatory prompt corrective
action provisions.
After taking into account the effect of the acquisition of Hawkeye State Bank
and the issuance of $20,000,000 in trust preferred securities, the Company's
regulatory capital ratios shown in the above table would be approximately 100
basis points lower, but still well in excess of the requirements to be
well-capitalized.
15
Liquidity
Liquidity management involves meeting the cash flow requirements of depositors
and borrowers. Liquidity management is conducted on both a daily and a long-term
basis. Investments in liquid assets are adjusted based on expected loan demand,
projected loan maturities and payments, expected deposit flows, and the
objectives set by the Company's funds management policy. The Company had liquid
assets (cash and cash equivalents) of $94,481,000 as of June 30, 2003, compared
with $181,214,000 as of December 31, 2002. (The amount of liquid assets at
December 31, 2002 was higher than normal and was the result of higher than
normal deposits.) Securities available for sale may be sold prior to maturity to
meet liquidity needs, to respond to market changes or to adjust the Company's
interest rate risk position. In addition, the Bank maintains lines of credit
with correspondent banks totaling $80 million that would allow it to borrow
Federal funds on a short-term basis, if necessary, and has additional borrowing
capacity of approximately $34 million at the Federal Home Loan Bank. During the
second quarter, the Company obtained a $5 million unsecured line of credit
through a large regional correspondent bank. The interest rate is variable and
tied to LIBOR. To date, the line has not been used. Management believes that the
Company has sufficient liquidity as of June 30, 2003 to meet the needs of
borrowers and depositors.
Market Risk Management
Market risk is the risk of earnings volatility that results from adverse changes
in interest rates and market prices. The Company's market risk is primarily
interest rate risk arising from its core banking activities of lending and
deposit taking. Interest rate risk is the risk that changes in market interest
rates may adversely affect the Company's net interest income. Management
continually develops and implements strategies to mitigate this risk. The
analysis of the Company's interest rate risk was presented in the Form 10-K
filed with the Securities and Exchange Commission on March 26, 2003 and is
incorporated herein by reference. The Company has not experienced any material
changes to its market risk position since December 31, 2002. Management does not
believe the Company's primary market risk exposures and how those exposures were
managed in the first six months of 2003 changed when compared to 2002.
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
The information appearing above under the heading "Market Risk Management" is
incorporated herein by reference.
Item 4. Controls and Procedures
a. Evaluation of disclosure controls and procedures. The Company's Principal
Executive Officer and Principal Financial Officer have reviewed and
evaluated the effectiveness of the Company's disclosure controls and
procedures (as defined in Exchange Act Rule 240.13a-15(e) as of the end of
the period covered by this report. Based on that evaluation, the Principal
Executive Officer and the Principal Financial Officer have concluded that
the Company's current disclosure controls and procedures are effective to
ensure that information required to be disclosed by the Company in the
reports that it files or submits under the Exchange Act is recorded,
processed, summarized and reported, within the time periods specified in
the Securities and Exchange Commission's rules and forms.
b. Changes in internal controls over financial reporting. There were no
changes in the Company's internal control over financial reporting that
occurred during the period covered by this report that has materially
affected, or is reasonably likely to materially affect, the Company's
internal control over financial reporting.
16
Part II - OTHER INFORMATION
Item 1. Legal Proceedings
West Bank from time to time is a party to various legal actions arising in the
normal course of business. Management believes, as of the date of this Form
10-Q, that there is no threatened or pending proceeding against the Company or
West Bank, which, if determined adversely, would have a material adverse effect
on the business or financial position of the Company or West Bank.
Item 4. Submission of Matters to a Vote of Security Holders
The Company's annual meeting of shareholders was held on April 30, 2003. The
record date for determination of shareholders entitled to vote at the meeting
was February 24, 2003. There were 16,060,271 shares outstanding as of that date,
each such share being entitled to one vote. At the shareholders' meeting the
holders of 15,233,092 or 94.85 percent of the outstanding shares were
represented in person or by proxy, which constituted a quorum. The following
proposals were voted on at the meeting:
Proposal I - Election of Directors
Eleven directors were elected to serve for a one year term or until their
successors shall have been elected and qualified. At the shareholders' meeting,
the individuals received the number of votes set opposite their names:
Vote
For Withheld
------------------------------
Frank W. Berlin ........................ 15,230,292 2,800
Steven G. Chapman ...................... 15,207,404 25,688
Michael A. Coppola ..................... 15,208,718 24,374
Orville E. Crowley ..................... 14,729,008 504,084
Raymond G. Johnston .................... 15,225,292 7,800
David L. Miller ........................ 15,165,267 67,825
David R. Milligan ...................... 15,203,517 29,575
Robert G. Pulver ....................... 15,230,292 2,800
Thomas E. Stanberry .................... 15,186,696 46,396
Jack G. Wahlig ......................... 14,717,187 515,905
Connie Wimer ........................... 14,692,775 540,317
Proposal II - Ratification of Appointment of Independent Auditors
A vote was also taken on the ratification of the appointment of McGladrey &
Pullen, LLP as independent auditors of the Company for the fiscal year ending
December 31, 2003. The results of the vote were as follows: for - 15,226,402,
against - 6,530, abstain - 160, Broker non-votes - 0.
Item 5. Other Items
On July 18, 2003, the Company issued $20,000,000 in long-term subordinated debt
through a pooled trust preferred security. This security is a hybrid capital
instrument that is included as Tier 1 capital for regulatory purposes, yet is
non-dilutive to common shareholders and to return on equity. The trust preferred
security has a 30 year maturity, does not require any principal amortization and
is callable in seven years at par at the Company's option. The interest rate is
fixed for seven years at 6.975% and then becomes variable at 305 basis points
over the 90 day LIBOR rate. Interest is payable quarterly. Proceeds were used to
fund the purchase of Hawkeye State Bank. Pursuant to Item 601(b)(4)(iii)(A) of
Regulation S-K, the Company agrees to furnish a copy of such agreement to the
Securities and Exchange Commission upon request.
17
Item 6. Exhibits and Reports on Form 8-K.
(a) The following exhibits are filed as part of this report:
Exhibits
3.1 Restated Articles of Incorporation of the Company *
3.2 By-laws of the Company *
10.1 Lease for Main Bank Facility *
10.2 Supplemental Agreement to Lease for Main Bank Facility *
10.3 Short-term Lease related to Main Bank Facility *
10.4 Assignment *
10.5 Lease Modification Agreement No. 1 for Main bank Facility *
10.6 Memorandum of Real estate contract *
10.7 Affidavit *
10.8 Addendum to Lease for Main Bank Facility *
10.9 Data Processing Contract *
10.10 Employment Contract *
10.11 Consulting Contract *
10.12 Data Processing Contract Amendment **
10.13 Purchase and Assumption Agreement between West Des Moines State
Bank and Hawkeye State Bank ***
31.1 Certification of Chief Executive Officer underSection 302 of the
Sarbanes Oxley Act of 2002
31.2 Certification of Chief Financial Officer under Section 302 of
the Sarbanes Oxley Act of 2002
32 Certification under Section 906 of the Sarbanes-Oxley Act of 2002
* Incorporated herein by reference to the related exhibit filed with the Form
10 on March 11, 2002.
** Incorporated herein by reference to the related exhibit filed with the Form
10-K on March 26, 2003.
*** Incorporated herein by reference to the related exhibit filed with the Form
10-Q on May 15, 2003
(b) Reports on Form 8-K: During the three months ended June 30, 2003, the
Company filed a Form 8-K on April 10, 2003 which contained a press release
announcing the quarterly dividend, a Form 8-K on April 29, 2003 which
contained a press release announcing earnings for the three months ended
March 31, 2003, and a Form 8-K on May 6, 2003 which contained a press
release announcing the acquisition of Hawkeye State Bank in Iowa City,
Iowa.
18
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
West Bancorporation, Inc.
- -------------------------
(Registrant)
August 13, 2003 By: /s/ Thomas E. Stanberry
- --------------- --------------------------------------------
Dated Thomas E. Stanberry
Chairman, President, Chief Executive Officer
August 13, 2003 By: /s/ Douglas R. Gulling
- --------------- --------------------------------------------
Dated Douglas R. Gulling
Chief Financial Officer
(Principal Accounting Officer)
19
EXHIBIT INDEX
The following exhibits are filed herewith:
Exhibit No. Description
31.1 Certification of Chief Executive Officer under Section 302 of
the Sarbanes Oxley Act of 2002
31.2 Certification of Chief Financial Officer under Section 302 of
the Sarbanes Oxley Act of 2002
32 Certification under Section 906 of the Sarbanes-Oxley Act of 2002
20