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Westamerica Bancorporation Reports Second Quarter 2025 Financial Results

1. WABC's Q2 2025 net income fell to $29.1 million. 2. Diluted EPS decreased from $1.16 to $1.12 in Q2 2025. 3. No provision for credit losses recognized and low funding costs reported. 4. WABC maintains high capital ratios and increased dividends per share. 5. 73,000 shares repurchased; nonperforming assets rose to $5 million.

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Why Bearish?

The decline in net income and EPS, combined with a rise in nonperforming assets, suggests potential profitability challenges and investor concerns. Historical parallels include instances when similar earnings drops led to decreased investor confidence and stock performance.

How important is it?

The earnings report directly impacts perception of WABC's financial health, likely influencing stock price significantly. Comparatively relevant earnings data can shift market sentiment rapidly.

Why Short Term?

The effects of Q2 results are likely to be reflected in the stock price soon as market participants react to earnings reports. Trends show immediate reactions to quarterly results, especially with concerning metrics.

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July 17, 2025 11:04 ET  | Source: Westamerica Bancorporation SAN RAFAEL, Calif., July 17, 2025 (GLOBE NEWSWIRE) -- Westamerica Bancorporation (Nasdaq: WABC), parent company of Westamerica Bank, generated net income for the second quarter 2025 of $29.1 million and diluted earnings per common share ("EPS") of $1.12. Second quarter 2025 results compare to first quarter 2025 net income of $31.0 million and EPS of $1.16. "Westamerica’s second quarter 2025 results benefited from the Company’s low-cost operating principles. The annualized cost of funding interest-earning loans, bonds and cash was 0.22 percent for the second quarter 2025. The Company recognized no provision for credit losses in the second quarter 2025. At June 30, 2025, nonperforming assets were $5.0 million and the allowance for credit losses on loans was $13.8 million. Westamerica operated efficiently, spending 39 percent of its revenue on operating costs in the second quarter 2025”, said Chairman, President and CEO David Payne. “Second quarter 2025 results generated an annualized 11.2 percent return on average common equity. Westamerica paid a $0.46 per common share dividend during the second quarter 2025, and retired 773 thousand common shares using its share repurchase plan. Westamerica’s capital ratios remain at historically high levels exceeding the highest regulatory guidelines,” concluded Payne. Net interest income on a fully-taxable equivalent (FTE) basis was $54.6 million for the second quarter 2025, compared to $56.4 million for the first quarter 2025. The annualized yield earned on loans, bonds and cash for the second quarter 2025 was 4.07 percent, compared to 4.14 percent for the first quarter 2025. The annualized cost of funding interest-earning loans, bonds and cash was 0.22 percent for the second quarter 2025, compared to 0.24 percent for the first quarter 2025. The Company provided no provision for credit losses in the second quarter 2025 compared to a $550 thousand reversal of provision for credit losses in the first quarter of 2025. The allowance for credit losses on loans was $13.8 million at June 30, 2025 compared to $13.9 million at March 31, 2025. Noninterest income for the second quarter 2025 totaled $10.3 million compared to $10.3 million for the first quarter 2025. Noninterest expenses were $25.5 million for the second quarter 2025 and $25.1 million for the first quarter 2025. The increase in noninterest expense is primarily due to higher salaries and benefits expense due to more business days in the second quarter 2025 compared to the first quarter 2025 and higher occupancy and equipment expense. The income tax provision (FTE) for the second quarter 2025 was $10.3 million compared to $11.1 million for the first quarter 2025. Westamerica Bancorporation’s wholly owned subsidiary Westamerica Bank, operates commercial banking and trust offices throughout Northern and Central California. Westamerica Bancorporation Web Address: www.westamerica.com For additional information contact:Westamerica Bancorporation1108 Fifth Avenue, San Rafael, CA 94901Robert A. Thorson – Investor Relations Contact707-863-6090investments@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, 2024 filed on Form 10-K and quarterly report for the quarter ended March 31, 2025 filed on Form 10-Q, describe some of these factors, including certain credit, interest rate, operational, liquidity and market risks associated with the Company's business and operations. Other factors described in these reports include changes in business and economic conditions, competition, fiscal and monetary policies, disintermediation, cyber security risks, legislation including the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the Sarbanes-Oxley Act of 2002 and the Gramm-Leach-Bliley Act of 1999, and mergers and acquisitions. Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward looking statements are made.   Public Information July 17, 2025 WESTAMERICA BANCORPORATION    FINANCIAL HIGHLIGHTS    June 30, 2025          1. Net Income Summary.      (in thousands except per-share amounts)    %   Q2'2025Q2'2024ChangeQ1'2025 Net Interest and Loan Fee     Income (FTE)$54,562 $64,100 -14.9%$56,390  Reversal of Provision     for Credit Losses -  - n/m (550) Noninterest Income 10,315  10,500 -1.8% 10,321  Noninterest Expense 25,529  26,130 -2.3% 25,127  Income Before Taxes (FTE) 39,348  48,470 -18.8% 42,134  Income Tax Provision (FTE) 10,282  13,008 -21.0% 11,097  Net Income$29,066 $35,462 -18.0%$31,037        Average Common Shares     Outstanding 25,889  26,680 -3.0% 26,642  Diluted Average Common     Shares Outstanding 25,889  26,681 -3.0% 26,642        Operating Ratios:     Basic Earnings Per Common     Share$1.12 $1.33 -15.8%$1.16  Diluted Earnings Per     Common Share 1.12  1.33 -15.8% 1.16  Return On Assets (a) 1.93% 2.18%  2.03% Return On Common     Equity (a) 11.2% 14.4%  11.9% Net Interest Margin (FTE) (a) 3.85% 4.15%  3.90% Efficiency Ratio (FTE) 39.3% 35.0%  37.7%       Dividends Paid Per Common     Share$0.46 $0.44 4.5%$0.44  Common Dividend Payout     Ratio 41% 33%  38%          %   6/30'25YTD6/30'24YTDChange  Net Interest and Loan Fee     Income (FTE)$110,952 $130,194 -14.8%  (Reversal of) Provision     for Credit Losses (550) 300 n/m  Noninterest Income 20,636  20,597 0.2%  Noninterest Expense 50,656  52,229 -3.0%  Income Before Taxes (FTE) 81,482  98,262 -17.1%  Income Tax Provision (FTE) 21,379  26,383 -19.0%  Net Income$60,103 $71,879 -16.4%        Average Common Shares     Outstanding 26,263  26,677 -1.6%  Diluted Average Common     Shares Outstanding 26,263  26,678 -1.6%        Operating Ratios:     Basic Earnings Per Common     Share$2.29 $2.69 -14.9%  Diluted Earnings Per     Common Share 2.29  2.69 -14.9%  Return On Assets (a) 1.98% 2.21%   Return On Common     Equity (a) 11.6% 14.8%   Net Interest Margin (FTE) (a) 3.87% 4.23%   Efficiency Ratio (FTE) 38.5% 34.6%         Dividends Paid Per Common     Share$0.90 $0.88 2.3%  Common Dividend Payout     Ratio 39% 33%        2. Net Interest Income.      (dollars in thousands)    %   Q2'2025Q2'2024ChangeQ1'2025 Interest and Loan Fee     Income (FTE)$57,751 $69,407 -16.8%$59,786  Interest Expense 3,189  5,307 -39.9% 3,396  Net Interest and Loan Fee     Income (FTE)$54,562 $64,100 -14.9%$56,390        Average Earning Assets$5,652,443 $6,145,626 -8.0%$5,794,836  Average Interest-Bearing     Liabilities 2,693,505  3,001,786 -10.3% 2,770,099        Yield on Earning Assets     (FTE) (a) 4.07% 4.50%  4.14% Cost of Funds (a) 0.22% 0.35%  0.24% Net Interest Margin (FTE) (a) 3.85% 4.15%  3.90% Interest Expense /     Interest-Bearing     Liabilities (a) 0.48% 0.71%  0.50% Net Interest Spread (FTE) (a) 3.59% 3.79%  3.64%          %   6/30'25YTD6/30'24YTDChange  Interest and Loan Fee     Income (FTE)$117,537 $138,502 -15.1%  Interest Expense 6,585  8,308 -20.7%  Net Interest and Loan Fee     Income (FTE)$110,952 $130,194 -14.8%        Average Earning Assets$5,723,246 $6,132,497 -6.7%  Average Interest-Bearing     Liabilities 2,731,590  2,978,676 -8.3%        Yield on Earning Assets     (FTE) (a) 4.11% 4.50%   Cost of Funds (a) 0.24% 0.27%   Net Interest Margin (FTE) (a) 3.87% 4.23%   Interest Expense /     Interest-Bearing     Liabilities (a) 0.49% 0.56%   Net Interest Spread (FTE) (a) 3.62% 3.94%        3. Loans & Other Earning Assets.      (average volume, dollars in thousands)    %   Q2'2025Q2'2024ChangeQ1'2025       Total Assets$6,042,100 $6,549,203 -7.7%$6,187,321  Total Earning Assets 5,652,443  6,145,626 -8.0% 5,794,836  Total Loans 762,216  838,016 -9.0% 789,935  Commercial Loans 115,943  133,605 -13.2% 120,189  Commercial Real Estate     Loans 488,960  487,209 0.4% 497,379  Consumer Loans 157,313  217,202 -27.6% 172,367  Total Investment Securities 4,236,303  4,944,191 -14.3% 4,395,565  Debt Securities Available for     Sale 3,400,199  4,079,896 -16.7% 3,553,755  Debt Securities Held to     Maturity 836,104  864,295 -3.3% 841,810  Total Interest-Bearing Cash 653,924  363,419 79.9% 609,336        Loans / Deposits 15.7% 16.1%  15.9%          %   6/30'25YTD6/30'24YTDChange        Total Assets$6,114,310 $6,537,562 -6.5%  Total Earning Assets 5,723,246  6,132,497 -6.7%  Total Loans 775,999  845,785 -8.3%  Commercial Loans 118,054  133,514 -11.6%  Commercial Real Estate     Loans 493,146  488,099 1.0%  Consumer Loans 164,799  224,172 -26.5%  Total Investment Securities 4,315,494  5,021,365 -14.1%  Debt Securities Available for     Sale 3,476,553  4,152,185 -16.3%  Debt Securities Held to     Maturity 838,941  869,180 -3.5%  Total Interest-Bearing Cash 631,753  265,347 138.1%        Loans / Deposits 15.8% 16.0%        4. Deposits, Other Interest-Bearing Liabilities & Equity.    (average volume, dollars in thousands)    %   Q2'2025Q2'2024ChangeQ1'2025       Total Deposits$4,841,803 $5,202,620 -6.9%$4,958,554  Noninterest Demand 2,245,077  2,485,023 -9.7% 2,293,059  Interest-Bearing Transaction 908,367  981,703 -7.5% 935,054  Savings 1,611,845  1,642,806 -1.9% 1,649,631  Time greater than $100K 27,306  34,721 -21.4% 29,460  Time less than $100K 49,208  58,367 -15.7% 51,350  Total Short-Term Borrowings 96,779  284,189 -65.9% 104,604  Bank Term Funding Program     Borrowings -  200,000 n/m -  Securities Sold under     Repurchase Agreements 96,779  84,189 15.0% 104,604  Shareholders' Equity 1,037,185  990,927 4.7% 1,055,925        Demand Deposits /     Total Deposits 46.4% 47.8%  46.2% Transaction & Savings     Deposits / Total Deposits 98.4% 98.2%  98.4%          %   6/30'25YTD6/30'24YTDChange        Total Deposits$4,899,856 $5,290,840 -7.4%  Noninterest Demand 2,268,936  2,508,702 -9.6%  Interest-Bearing Transaction 921,637  1,019,998 -9.6%  Savings 1,630,633  1,667,261 -2.2%  Time greater than $100K 28,377  35,427 -19.9%  Time less than $100K 50,273  59,452 -15.4%  Total Short-Term Borrowings 100,670  196,538 -48.8%  Bank Term Funding Program     Borrowings -  131,291 n/m  Securities Sold under     Repurchase Agreements 100,670  65,247 54.3%  Shareholders' Equity 1,046,504  978,384 7.0%        Demand Deposits /     Total Deposits 46.3% 47.4%   Transaction & Savings     Deposits / Total Deposits 98.4% 98.2%        5. Interest Yields Earned & Rates Paid.      (dollars in thousands)   Q2'2025   AverageIncome/Yield (a) /   VolumeExpenseRate (a)        Interest & Loan Fee Income Earned:     Total Earning Assets (FTE)$5,652,443 $57,751 4.07%  Total Loans (FTE) 762,216  10,591 5.57%  Commercial Loans (FTE) 115,943  1,833 6.34%  Commercial Real Estate     Loans 488,960  6,452 5.29%  Consumer Loans 157,313  2,306 5.88%  Total Investments (FTE) 4,236,303  39,887 3.75%  Total Debt Securities     Available for Sale (FTE) 3,400,199  31,354 3.67%  Corporate Securities 1,945,959  12,898 2.65%  Collateralized Loan     Obligations 792,914  12,405 6.19%  Agency Mortgage Backed     Securities 273,083  2,334 3.42%  Securities of U.S.     Government Sponsored     Entities 311,923  2,777 3.56%  Obligations of States and     Political Subdivisions     (FTE) 62,093  506 3.26%  Other Debt Securities     Available for Sale (FTE) 14,227  434 12.21%  Total Debt Securities Held to     Maturity (FTE) 836,104  8,533 4.08%  Agency Mortgage Backed     Securities 51,839  304 2.35%  Corporate Securities 737,787  7,816 4.24%  Obligations of States and     Political Subdivisions     (FTE) 46,478  413 3.56%  Total Interest-Bearing Cash 653,924  7,273 4.40%        Interest Expense Paid:     Total Earning Assets 5,652,443  3,189 0.22%  Total Interest-Bearing     Liabilities 2,693,505  3,189 0.48%  Total Interest-Bearing     Deposits 2,596,726  3,045 0.47%  Interest-Bearing Transaction 908,367  44 0.02%  Savings 1,611,845  2,950 0.73%  Time less than $100K 49,208  37 0.30%  Time greater than $100K 27,306  14 0.21%  Total Short-Term Borrowings 96,779  144 0.60%  Securities Sold under     Repurchase Agreements 96,779  144 0.60%        Net Interest Income and     Margin (FTE) $54,562 3.85%         Q2'2024   AverageIncome/Yield (a) /   VolumeExpenseRate (a)  Interest & Loan Fee Income Earned:     Total Earning Assets (FTE)$6,145,626 $69,407 4.50%  Total Loans (FTE) 838,016  11,441 5.49%  Commercial Loans (FTE) 133,605  2,418 7.28%  Commercial Real Estate     Loans 487,209  6,014 4.96%  Consumer Loans 217,202  3,009 5.57%  Total Investments (FTE) 4,944,191  53,005 4.27%  Total Debt Securities     Available for Sale (FTE) 4,079,896  44,236 4.31%  Corporate Securities 2,090,829  14,366 2.75%  Collateralized Loan     Obligations 1,347,475  24,620 7.23%  Agency Mortgage Backed     Securities 241,391  1,465 2.43%  Securities of U.S.     Government sponsored     entities 309,395  2,777 3.59%  Obligations of States and     Political Subdivisions     (FTE) 72,319  543 3.01%  U.S. Treasury Securities 4,260  54 5.08%  Other Debt Securities     Available for Sale (FTE) 14,227  411 11.55%  Total Debt Securities Held to     Maturity (FTE) 864,295  8,769 4.06%  Agency Mortgage Backed     Securities 70,804  401 2.27%  Corporate Securities 730,978  7,815 4.28%  Obligations of States and     Political Subdivisions     (FTE) 62,513  553 3.54%  Total Interest-Bearing Cash 363,419  4,961 5.40%        Interest Expense Paid:     Total Earning Assets 6,145,626  5,307 0.35%  Total Interest-Bearing     Liabilities 3,001,786  5,307 0.71%  Total Interest-Bearing     Deposits 2,717,597  2,460 0.36%  Interest-Bearing Transaction 981,703  69 0.03%  Savings 1,642,806  2,322 0.57%  Time less than $100K 58,367  49 0.34%  Time greater than $100K 34,721  20 0.23%  Total Short-Term Borrowings 284,189  2,847 4.02%  Bank Term Funding Program     Borrowings 200,000  2,692 5.40%  Securities Sold under     Repurchase Agreements 84,189  155 0.74%        Net Interest Income and     Margin (FTE) $64,100 4.15%       6. Noninterest Income.      (dollars in thousands except per-share amounts)    %   Q2'2025Q2'2024ChangeQ1'2025 Service Charges on Deposit     Accounts$3,368 $3,469 -2.9%$3,381  Merchant Processing     Services 2,687  2,733 -1.7% 2,733  Debit Card Fees 1,664  1,706 -2.5% 1,581  Trust Fees 867  811 6.9% 899  ATM Processing Fees 482  540 -10.7% 463  Other Service Fees 450  450 0.0% 429  Life Insurance Gains 106  - n/m 102  Other Noninterest Income 691  791 -12.6% 733  Total Noninterest Income$10,315 $10,500 -1.8%$10,321        Operating Ratios:     Total Revenue (FTE)$64,877 $74,600 -13.0%$66,711  Noninterest Income /     Revenue (FTE) 15.9% 14.1%  15.5% Service Charges /     Avg. Deposits (a) 0.28% 0.27%  0.28% Total Revenue (FTE) Per     Avg. Common Share (a)$10.05 $11.25 -10.6%$10.16           %   6/30'25YTD6/30'24YTDChange  Service Charges on Deposit     Accounts$6,749 $6,939 -2.7%  Merchant Processing     Services 5,420  5,240 3.4%  Debit Card Fees 3,245  3,249 -0.1%  Trust Fees 1,766  1,605 10.0%  ATM Processing Fees 945  1,131 -16.4%  Other Service Fees 879  888 -1.0%  Life Insurance Gains 208  - n/m  Other Noninterest Income 1,424  1,545 -7.8%  Total Noninterest Income$20,636 $20,597 0.2%        Operating Ratios:     Total Revenue (FTE)$131,588 $150,791 -12.7%  Noninterest Income /     Revenue (FTE) 15.7% 13.7%   Service Charges /     Avg. Deposits (a) 0.28% 0.26%   Total Revenue (FTE) Per     Avg. Common Share (a)$10.10 $11.37 -11.1%       7. Noninterest Expense.      (dollars in thousands)    %   Q2'2025Q2'2024ChangeQ1'2025       Salaries and Related Benefits$12,303 $12,483 -1.4%$12,126  Occupancy and Equipment 5,154  5,158 -0.1% 5,038  Outsourced Data Processing 2,709  2,511 7.9% 2,697  Limited Partnership     Operating Losses 915  1,440 -36.5% 915  Professional Fees 386  362 6.6% 395  Courier Service 687  686 0.1% 688  Other Noninterest Expense 3,375  3,490 -3.3% 3,268  Total Noninterest Expense$25,529 $26,130 -2.3%$25,127        Operating Ratios:     Noninterest Expense /     Avg. Earning Assets (a) 1.81% 1.71%  1.76% Noninterest Expense /     Revenues (FTE) 39.3% 35.0%  37.7%          %   6/30'25YTD6/30'24YTDChange        Salaries and Related Benefits$24,429 $25,069 -2.6%  Occupancy and Equipment 10,192  10,198 -0.1%  Outsourced Data Processing 5,406  5,047 7.1%  Limited Partnership     Operating Losses 1,830  2,880 -36.5%  Professional Fees 781  764 2.2%  Courier Service 1,375  1,335 3.0%  Other Noninterest Expense 6,643  6,936 -4.2%  Total Noninterest Expense$50,656 $52,229 -3.0%        Operating Ratios:     Noninterest Expense /     Avg. Earning Assets (a) 1.78% 1.71%   Noninterest Expense /     Revenues (FTE) 38.5% 34.6%        8. Allowance for Credit Losses.      (dollars in thousands)    %   Q2'2025Q2'2024ChangeQ1'2025       Average Total Loans$762,216 $838,016 -9.0%$789,935        Beginning of Period     Allowance for Credit     Losses on Loans (ACLL)$13,914 $15,879 -12.4%$14,780  Reversal of Provision for     Credit Losses -  - n/m (550) Net ACLL (Losses)     Recoveries (127) 73 n/m (316) End of Period ACLL$13,787 $15,952 -13.6%$13,914        Gross ACLL Recoveries /     Gross ACLL Losses 87% 105%  82% Net ACLL (Losses)     Recoveries/     Avg. Total Loans (a) -0.07% 0.04%  -0.16%          %   6/30'25YTD6/30'24YTDChange        Average Total Loans$775,999 $845,785 -8.3%        Beginning of Period ACLL$14,780 $16,867 -12.4%  (Reversal of) Provision for     Credit Losses (550) 300 n/m  Net ACLL Losses (443) (1,215)-63.5%  End of Period ACLL$13,787 $15,952 -13.6%        Gross ACLL Recoveries /     Gross ACLL Losses 83% 66%   Net ACLL Losses /     Avg. Total Loans (a) -0.12% -0.29%          (dollars in thousands)    %   6/30/256/30/24Change3/31/25 Allowance for Credit Losses     on Loans$13,787 $15,952 -13.6%$13,914  Allowance for Credit Losses     on Held to Maturity     Securities 1  1 0.0% 1  Total Allowance for Credit     Losses$13,788 $15,953 -13.6%$13,915        Allowance for Unfunded     Credit Commitments$201 $201 0.0%$201       9. Credit Quality.      (dollars in thousands)    %   6/30/256/30/24Change3/31/25 Nonperforming Loans:     Nonperforming Nonaccrual     Loans$- $971 n/m$-  Performing Nonaccrual     Loans 4,553  - n/m -  Total Nonaccrual Loans 4,553  971 368.9% -  Accruing Loans 90+ Days     Past Due 411  580 -29.1% 277  Total Nonperforming Loans$4,964 $1,551 220.1%$277        Total Loans Outstanding$748,264 $831,842 -10.0%$771,030        Total Assets 5,825,069  6,312,145 -7.7% 5,966,624        Loans:     Allowance for Credit Losses     on Loans$13,787 $15,952 -13.6%$13,914  Allowance for Credit Losses     on Loans / Loans 1.84% 1.92%  1.80% Nonperforming Loans /     Total Loans 0.66% 0.19%  0.04%      10. Liquidity.           At June 30, 2025, the Company had $626,437 thousand in cash balances. During the twelve months ending June 30, 2026, the Company expects to receive $288,000 thousand in principal payments from its debt securities. If additional operational liquidity is required, the Company can pledge debt securities as collateral for borrowing purposes; at June 30, 2025, the Company’s debt securities which qualify as collateral for borrowing totaled $3,522,823 thousand. In the ordinary course of business, the Company pledges debt securities as collateral for certain depository customers; at June 30, 2025, the Company had pledged $715,788 thousand in debt securities for depository customers. In the ordinary course of business, the Company pledges debt securities as collateral for borrowing from the Federal Reserve Bank; at June 30, 2025, the Company had pledged $703,398 thousand in debt securities at the Federal Reserve Bank. During the six months ended June 30, 2025, the Company’s average borrowings from the Federal Reserve Bank and correspondent banks were $-0- thousand and $-0- thousand, respectively, and at June 30, 2025, the Company had no borrowings from the Federal Reserve Bank or other correspondent banks. At June 30, 2025, the Company had access to borrowing from the Federal Reserve up to $703,398 thousand based on collateral pledged at June 30, 2025. At June 30, 2025, the Company’s estimated unpledged collateral qualifying debt securities totaled $1,683,788 thousand. Debt securities eligible as collateral are shown at market value.           (in thousands)     6/30/25 Debt Securities Eligible as     Collateral:     Corporate Securities   $2,517,133  Collateralized Loan     Obligations rated AAA    257,649  Obligations of States and     Political Subdivisions    106,428  Agency Mortgage Backed     Securities    339,710  Securities of U.S. Government     Sponsored Entities    301,903  Total Debt Securities Eligible     as Collateral   $3,522,823        Debt Securities Pledged     as Collateral:     Debt Securities Pledged     at the Federal Reserve Bank   ($703,398) Deposits by Public Entities    (715,788) Securities Sold under     Repurchase Agreements    (412,956) Other    (6,893) Total Debt Securities Pledged     as Collateral   ($1,839,035)       Estimated Debt Securities     Available to Pledge   $1,683,788       11. Capital.      (in thousands, except per-share amounts)    %   6/30/256/30/24Change3/31/25       Shareholders' Equity$921,783 $815,600 13.0%$923,138  Total Assets 5,825,069  6,312,145 -7.7% 5,966,624  Shareholders' Equity/     Total Assets 15.82% 12.92%  15.47% Shareholders' Equity/     Total Loans 123.19% 98.05%  119.73% Tangible Common Equity     Ratio 14.03% 11.21%  13.71% Common Shares Outstanding 25,587  26,683 -4.1% 26,360  Common Equity Per Share$36.03 $30.57 17.9%$35.02  Market Value Per Common     Share 48.44  48.53 -0.2% 50.63         (shares in thousands)    %   Q2'2025Q2'2024ChangeQ1'2025 Share Retirements (Issuances):     Total Shares Retired 773  - n/m 361  Average Retirement Price$49.61 $- n/m$50.96  Net Shares Retired (Issued) 773  (5)n/m 348           %   6/30'25YTD6/30'24YTDChange        Total Shares Retired 1,134  4 n/m  Average Retirement Price$49.88 $45.58 n/m  Net Shares Retired (Issued) 1,121  (12)n/m      12. Period-End Balance Sheets.      (unaudited, dollars in thousands)    %   6/30/256/30/24Change3/31/25 Assets:     Cash and Due from Banks$626,437 $486,124 28.9%$727,336        Debt Securities Available for     Sale:     Corporate Securities 1,792,021  1,855,618 -3.4% 1,802,791  Collateralized Loan     Obligations 780,147  1,255,110 -37.8% 822,111  Agency Mortgage Backed     Securities 291,543  222,806 30.9% 250,844  Securities of U.S.     Government Sponsored     Entities 301,903  291,206 3.7% 299,722  Obligations of States and     Political Subdivisions 60,835  69,758 -12.8% 60,581  U.S. Treasury Securities -  4,820 n/m -  Total Debt Securities     Available for Sale 3,226,449  3,699,318 -12.8% 3,236,049        Debt Securities Held to     Maturity:     Agency Mortgage Backed     Securities 49,878  67,777 -26.4% 53,528  Corporate Securities 738,846  732,049 0.9% 737,146  Obligations of States and     Political Subdivisions (1) 45,715  61,042 -25.1% 48,674  Total Debt Securities     Held to Maturity (1) 834,439  860,868 -3.1% 839,348        Loans 748,264  831,842 -10.0% 771,030  Allowance For Credit Losses     on Loans (13,787) (15,952)-13.6% (13,914) Total Loans, net 734,477  815,890 -10.0% 757,116        Premises and Equipment, net 25,850  26,275 -1.6% 25,722  Identifiable Intangibles, net 19  234 -91.9% 72  Goodwill 121,673  121,673 0.0% 121,673  Other Assets 255,725  301,763 -15.3% 259,308        Total Assets$5,825,069 $6,312,145 -7.7%$5,966,624        Liabilities and Shareholders'     Equity:     Deposits:     Noninterest-Bearing$2,175,841 $2,459,467 -11.5%$2,241,802  Interest-Bearing Transaction 894,774  936,186 -4.4% 920,461  Savings 1,603,974  1,646,781 -2.6% 1,633,445  Time 72,946  89,006 -18.0% 78,387  Total Deposits 4,747,535  5,131,440 -7.5% 4,874,095        Bank Term Funding     Program Borrowings -  200,000 n/m -  Securities Sold under     Repurchase Agreements 101,210  100,167 1.0% 113,219  Total Short-Term     Borrowed Funds 101,210  300,167 -66.3% 113,219        Other Liabilities 54,541  64,938 -16.0% 56,172  Total Liabilities 4,903,286  5,496,545 -10.8% 5,043,486        Shareholders' Equity:     Common Equity:     Paid-In Capital 456,964  474,618 -3.7% 470,844  Accumulated Other     Comprehensive Loss (116,747) (197,300)-40.8% (136,768) Retained Earnings 581,566  538,282 8.0% 589,062  Total Shareholders' Equity 921,783  815,600 13.0% 923,138        Total Liabilities and     Shareholders' Equity$5,825,069 $6,312,145 -7.7%$5,966,624       13. Income Statements.      (unaudited, in thousands except per-share amounts)    %   Q2'2025Q2'2024ChangeQ1'2025 Interest and Loan Fee Income:     Loans$10,523 $11,354 -7.3%$10,669  Equity Securities 195  175 11.4% 195  Debt Securities Available     for Sale 31,028  43,927 -29.4% 33,430  Debt Securities Held to     Maturity 8,448  8,655 -2.4% 8,494  Interest-Bearing Cash 7,273  4,961 46.6% 6,703  Total Interest and Loan     Fee Income 57,467  69,072 -16.8% 59,491        Interest Expense:     Transaction Deposits 44  69 -36.2% 46  Savings Deposits 2,950  2,322 27.0% 3,128  Time Deposits 51  69 -26.1% 55  Bank Term Funding Program     Borrowings -  2,692 n/m -  Securities Sold under     Repurchase Agreements 144  155 -6.7% 167  Total Interest Expense 3,189  5,307 -39.9% 3,396        Net Interest and Loan     Fee Income 54,278  63,765 -14.9% 56,095        Reversal of Provision for     Credit Losses -  - n/m (550)       Noninterest Income:     Service Charges on Deposit     Accounts 3,368  3,469 -2.9% 3,381  Merchant Processing     Services 2,687  2,733 -1.7% 2,733  Debit Card Fees 1,664  1,706 -2.5% 1,581  Trust Fees 867  811 6.9% 899  ATM Processing Fees 482  540 -10.7% 463  Other Service Fees 450  450 0.0% 429  Life Insurance Gains 106  - n/m 102  Other Noninterest Income 691  791 -12.6% 733  Total Noninterest Income 10,315  10,500 -1.8% 10,321        Noninterest Expense:     Salaries and Related Benefits 12,303  12,483 -1.4% 12,126  Occupancy and Equipment 5,154  5,158 -0.1% 5,038  Outsourced Data Processing 2,709  2,511 7.9% 2,697  Limited Partnership     Operating Losses 915  1,440 -36.5% 915  Professional Fees 386  362 6.6% 395  Courier Service 687  686 0.1% 688  Other Noninterest Expense 3,375  3,490 -3.3% 3,268  Total Noninterest Expense 25,529  26,130 -2.3% 25,127        Income Before Income Taxes 39,064  48,135 -18.8% 41,839  Income Tax Provision 9,998  12,673 -21.1% 10,802  Net Income$29,066 $35,462 -18.0%$31,037        Average Common Shares     Outstanding 25,889  26,680 -3.0% 26,642  Diluted Average Common     Shares Outstanding 25,889  26,681 -3.0% 26,642        Per Common Share Data:     Basic Earnings$1.12 $1.33 -15.8%$1.16  Diluted Earnings 1.12  1.33 -15.8% 1.16  Dividends Paid 0.46  0.44 4.5% 0.44           %   6/30'25YTD6/30'24YTDChange  Interest and Loan Fee Income:     Loans$21,192 $22,678 -6.6%  Equity Securities 390  349 11.7%  Debt Securities Available     for Sale 64,458  90,170 -28.5%  Debt Securities Held to     Maturity 16,942  17,377 -2.5%  Interest-Bearing Cash 13,976  7,244 92.9%  Total Interest and Loan     Fee Income 116,958  137,818 -15.1%        Interest Expense:     Transaction Deposits 90  188 -52.1%  Savings Deposits 6,078  4,239 43.4%  Time Deposits 106  139 -23.7%  Bank Term Funding Program     Borrowings -  3,535 n/m  Securities Sold under     Repurchase Agreements 311  207 50.2%  Total Interest Expense 6,585  8,308 -20.7%        Net Interest and Loan     Fee Income 110,373  129,510 -14.8%        (Reversal of) Provision     for Credit Losses (550) 300 n/m        Noninterest Income:     Service Charges on Deposit 6,749  6,939 -2.7%  Accounts     Merchant Processing     Services 5,420  5,240 3.4%  Debit Card Fees 3,245  3,249 -0.1%  Trust Fees 1,766  1,605 10.0%  ATM Processing Fees 945  1,131 -16.4%  Other Service Fees 879  888 -1.0%  Life Insurance Gains 208  - n/m  Other Noninterest Income 1,424  1,545 -7.8%  Total Noninterest Income 20,636  20,597 0.2%        Noninterest Expense:     Salaries and Related Benefits 24,429  25,069 -2.6%  Occupancy and Equipment 10,192  10,198 -0.1%  Outsourced Data Processing 5,406  5,047 7.1%  Limited Partnership     Operating Losses 1,830  2,880 -36.5%  Professional Fees 781  764 2.2%  Courier Service 1,375  1,335 3.0%  Other Noninterest Expense 6,643  6,936 -4.2%  Total Noninterest Expense 50,656  52,229 -3.0%        Income Before Income Taxes 80,903  97,578 -17.1%  Income Tax Provision 20,800  25,699 -19.1%  Net Income$60,103 $71,879 -16.4%        Average Common Shares     Outstanding 26,263  26,677 -1.6%  Diluted Average Common     Shares Outstanding 26,263  26,678 -1.6%        Per Common Share Data:     Basic Earnings$2.29 $2.69 -14.9%  Diluted Earnings 2.29  2.69 -14.9%  Dividends Paid 0.90  0.88 2.3%        Footnotes and Abbreviations:     (1) Debt Securities Held To Maturity and Obligations of States and Political Subdivisions are net of related reserve for expected credit losses of $1 thousand at June 30, 2025, March 31, 2025 and June 30, 2024.       (FTE) Fully Taxable Equivalent. The Company presents its net interest margin and net interest income on a FTE basis using the current statutory federal tax rate. Management believes the FTE basis is valuable to the reader because the Company’s loan and investment securities portfolios contain a portion of municipal loans and securities that are federally tax exempt. The Company’s tax exempt loans and securities composition may not be similar to that of other banks, therefore in order to reflect the impact of the federally tax exempt loans and securities on the net interest margin and net interest income for comparability with other banks, the Company presents its net interest margin and net interest income on a FTE basis.       (a) Annualized          

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