Westamerica Bancorporation Announces Stock Repurchase Plan

Rhea-AI Summary

Westamerica Bancorporation (NASDAQ: WABC) has announced a significant stock repurchase plan approved by its Board of Directors. The plan authorizes the repurchase of up to 2,000,000 shares of the company's common stock, representing approximately 7.5% of outstanding shares as of December 31, 2024.

The repurchase program will be executed through open market or privately negotiated transactions and will remain active until March 31, 2026. According to CEO David Payne, this initiative reflects Westamerica's strong financial position, conservative risk approach, and consistent earnings performance.

The company operates banking and trust offices throughout Northern and Central California through its subsidiary, Westamerica Bank.

Positive

• Share repurchase of 2M shares (7.5% of outstanding shares) indicates strong capital return to shareholders
• Company demonstrates financial strength and stable earnings
• Conservative risk profile maintains stability

Negative

• Significant cash outlay required for buyback may limit other investment opportunities
• Reduced float could potentially affect stock liquidity

Insights

Financial Analyst

Westamerica Bancorporation's (WABC) newly approved 2 million share repurchase program represents a substantial capital allocation decision, equating to 7.5% of outstanding shares and approximately $100 million at current valuation. This program signals strong confidence from management in the bank's financial position and future prospects.

The authorization's size is particularly notable for a regional bank with $1.33 billion market capitalization. Banking regulations require maintaining specific capital ratios, so this scale of buyback indicates Westamerica likely holds significant excess capital beyond regulatory requirements. The program provides flexibility through its 13-month execution window, allowing management to opportunistically repurchase when they perceive shares as undervalued.

For investors, this represents a meaningful capital return mechanism that should support share prices while potentially enhancing earnings per share metrics through share count reduction. The buyback effectively represents an alternative to deploying capital toward acquisitions or accelerated organic growth, suggesting management views current share valuation as an attractive investment relative to other opportunities.

Regional bank valuations have faced pressure in recent years, with many trading below book value. This repurchase authorization may reflect management's view that WABC shares represent compelling value, particularly given CEO Payne's specific mention of the company's "conservative risk profile and reliable earnings stream" as justification for the program.

SAN RAFAEL, Calif., Feb. 27, 2025 (GLOBE NEWSWIRE) -- The Board of Directors of Westamerica Bancorporation (NASDAQ: WABC) today approved a plan to repurchase, as conditions warrant, up to 2,000,000 shares of the Company’s common stock on the open market or in privately negotiated transactions prior to March 31, 2026. The repurchase plan represents approximately 7.5 percent of the Company’s common stock outstanding as of December 31, 2024.

Chairman, President and CEO David Payne stated, “This stock repurchase plan recognizes Westamerica’s financial strength, conservative risk profile and reliable earnings stream.”

Westamerica Bancorporation, through its wholly owned subsidiary, Westamerica Bank, operates banking and trust offices throughout Northern and Central California.

Westamerica Bancorporation Web Address: www.westamerica.com

For additional information contact:
Westamerica Bancorporation
1108 Fifth Avenue, San Rafael, CA 94901
Robert A. Thorson – Investment Relations Contact, 707-863-6090
investments@westamerica.com

FORWARD-LOOKING INFORMATION:

The following appears in accordance with the Private Securities Litigation Reform Act of 1995:

This press release may contain forward-looking statements about the Company, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.”

Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors — many of which are beyond the Company’s control — could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. The Company’s most recent reports filed with the Securities and Exchange Commission, including the annual report for the year ended December 31, 2023 filed on Form 10-K and quarterly report for the quarter ended September 30, 2024 filed on Form 10-Q, describe some of these factors, including certain credit, interest rate, operational, liquidity and market risks associated with the Company’s business and operations. Other factors described in these reports include changes in business and economic conditions, competition, fiscal and monetary policies, disintermediation, cyber security risks, legislation including the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2011, the Sarbanes-Oxley Act of 2002 and the Gramm-Leach-Bliley Act of 1999, and mergers and acquisitions.

Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward looking statements are made.

FAQ

How many shares will Westamerica Bancorporation (WABC) repurchase in its new buyback program?

Westamerica Bancorporation will repurchase up to 2,000,000 shares, representing 7.5% of outstanding shares as of December 31, 2024.

When does WABC's new stock repurchase program expire?

The stock repurchase program will remain active until March 31, 2026.

How will Westamerica Bancorporation (WABC) execute its share repurchase plan?

WABC will execute the repurchase through open market purchases or privately negotiated transactions.

What percentage of WABC's outstanding shares does the new buyback represent?

The repurchase plan represents approximately 7.5% of the company's common stock outstanding as of December 31, 2024.