What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-07-23 compared with 2026-04-23 · 172 added, 93 removed, 364 unchanged (42% of the section changed)

27 unchanged sentences

the monetary, trade and other regulatory policies of the U.S.

the effects of acts of war or terrorism, including the wars in Iran and Ukraine and the military conflict between Israel and Hamas in the Middle East;

the effects of acts of war or terrorism, including the wars in Iran and Ukraine, ongoing conflicts in the Middle East, and other international military conflicts that can increase levels of political and economic unpredictability, contribute to rising energy and commodity prices, affect global supply chains, increase the volatility of financial markets, and other matters beyond our control;

widespread disease, pandemics or epidemics, or other adverse external events;

4 unchanged sentences

talent and labor shortages;

emerging issues related to the development and use of artificial intelligence that could give rise to legal or regulatory action, damage our reputation or otherwise materially harm our business or customers;

the availability of future equity and debt issuances and other capital raising opportunities on favorable terms;

and any other risks described in the “Risk Factors” sections of this and other reports filed by the Company with the SEC.

24 unchanged sentences

The following table reconciles the non-GAAP financial measures of net interest income and net interest margin on a FTE basis and efficiency ratio on an adjusted and FTE basis to their most directly comparable measures under GAAP.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Reconciliation of net interest income and net interest margin on a FTE basis to GAAP:

1 unchanged sentence

Tax-equivalent adjustment (1)

75 59 147 125

Net interest income on a FTE basis (non-GAAP) 25,596 21,478 50,053 42,399

19 unchanged sentences

The following discussion describes the consolidated operations and financial condition of the Company, West Bank and West Bank's special purpose subsidiaries.

Results of operations for the three months ended March 31, 2026 are compared to the results for the same period in 2025, and the consolidated financial condition of the Company as of March 31, 2026 is compared to that as of December 31, 2025.

Results of operations for the three and six months ended June 30, 2026 are compared to the results for the same periods in 2025, and the consolidated financial condition of the Company as of June 30, 2026 is compared to that as of December 31, 2025.

This discussion and analysis should be read in conjunction with Management's Discussion and Analysis of Financial Condition and Results of Operations included in the Company's Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on February 26, 2026.

2 unchanged sentences

and southern Minnesota, which includes the cities of Rochester, Owatonna, Mankato and St.

Net income for the three months ended March 31, 2026 was $10,572, or $0.61 per diluted common share, compared to $7,842, or $0.46 per diluted common share, for the three months ended March 31, 2025.

The Company's annualized return on average assets and return on average equity for the three months ended March 31, 2026 were 1.06 percent and 15.91 percent, respectively, compared to 0.81 percent and 13.84 percent, respectively, for the three months ended March 31, 2025.

Net interest income for the three months ended March 31, 2026 increased $3,530, or 16.9 percent, compared to the three months ended March 31, 2025.

The increase in net interest income was primarily due to increases in interest income on deposits with banks and securities purchased under agreements to resell and decreases in interest expense on deposits and borrowed funds, partially offset by a decrease in interest income on securities.

Noninterest income increased $311 for the three months ended March 31, 2026 compared to the same period in 2025, primarily due to an increase in trust services revenue.

Noninterest expense increased $402 during the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily due to an increase in salaries and employee benefits, partially offset by a decrease in FDIC insurance expense.

Total loans outstanding decreased $10,052, or 0.3 percent, to $2,991,638 during the first three months of 2026.

The credit quality of the loan portfolio remained pristine, as evidenced by the Company's ratio of nonperforming loans to total assets of 0.00 percent as of both March 31, 2026 and December 31, 2025.

As of both March 31, 2026 and December 31, 2025, the allowance for credit losses was 1.02 percent of total outstanding loans.

Management believed the allowance for credit losses at March 31, 2026 was adequate to absorb expected losses in the loan portfolio as of that date.

Net income for the three months ended June 30, 2026 was $11,073, or $0.64 per diluted common share, compared to $7,979, or $0.47 per diluted common share, for the three months ended June 30, 2025.

The Company's annualized return on average assets and return on average equity for the three months ended June 30, 2026 were 1.10 percent and 16.21 percent, respectively, compared to 0.80 percent and 13.65 percent, respectively, for the three months ended June 30, 2025.

Net interest income for the three months ended June 30, 2026 increased $4,102, or 19.2 percent, compared to the three months ended June 30, 2025.

The increase in net interest income was primarily due to increases in interest income on loans and securities purchased under agreements to resell, a decrease in interest expense on deposits and partially offset by decreases in interest income on securities and deposits with banks.

Noninterest income increased $186 for the three months ended June 30, 2026 compared to the same period in 2025, primarily due to an increase in trust services revenue.

Noninterest expense increased $282 during the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily due to an increase in salaries and employee benefits, partially offset by a decrease in FDIC insurance expense.

Net income for the six months ended June 30, 2026 was $21,645, or $1.26 per diluted common share, compared to $15,821, or $0.93 per diluted common share, for the six months ended June 30, 2025.

The Company's annualized return on average assets and return on average equity for the six months ended June 30, 2026 were 1.08 percent and 16.06 percent, respectively, compared to 0.80 percent and 13.74 percent, respectively, for the six months ended June 30, 2025.

Net interest income for the six months ended June 30, 2026 increased $7,632, or 18.1 percent, compared to the six months ended June 30, 2025.

The increase in net interest income was primarily due to increases in interest income on loans and securities purchased under agreements to resell, a decrease in interest expense on deposits, and partially offset by a decrease in interest income on securities.

Noninterest income increased $497 for the six months ended June 30, 2026 compared to the same period in 2025, primarily due to an increase in trust services revenue.

Noninterest expense increased $684 during the six months ended June 30, 2026 compared to the six months ended June 30, 2025, primarily due to an increase in salaries and employee benefits, partially offset by a decrease in FDIC insurance expense.

West Bancorporation, Inc.

Management's Discussion and Analysis

(dollars in thousands, except share and per share data)

On a quarterly basis, the Company compares three key performance metrics to those of our identified peer group.

The peer group for 2026 consists of 20 Midwestern, publicly traded financial institutions, including Ames National Corporation, Bank First Corporation, Bridgewater Bancshares Inc., CF Bankshares, Inc., ChoiceOne Financial Services, Inc., Civista Bancshares, Inc., Equity Bancshares, Inc., Farmers National Banc Corp., Farmers & Merchants Bancorp., First Business Financial Services, Inc., First Financial Corp., First Mid Bancshares, Inc., First Savings Financial Group, German American Bancorp, Inc., HBT Financial Inc., Hills Bancorporation, Isabella Bank Corporation, LCNB Corp., Mercantile Bank Corporation, and Southern Missouri Bancorp, Inc.

The peer group for 2026 consists of 19 Midwestern, publicly traded financial institutions, including Ames National Corporation, Bank First Corporation, Bridgewater Bancshares Inc., CF Bankshares, Inc., ChoiceOne Financial Services, Inc., Civista Bancshares, Inc., Equity Bancshares, Inc., Farmers National Banc Corp., Farmers & Merchants Bancorp., First Business Financial Services, Inc., First Financial Corp., First Mid Bancshares, Inc., German American Bancorp, Inc., HBT Financial Inc., Hills Bancorporation, Isabella Bank Corporation, LCNB Corp., Mercantile Bank Corporation, and Southern Missouri Bancorp, Inc.

The Company ranks in the middle of the peer group by total assets.

5 unchanged sentences

Peer Group Range (2)

As of and for the three months ended March 31, 2026 As of and for the year ended December 31, 2025 As of and for the year ended December 31, 2025

As of and for the six months ended June 30, 2026 As of and for the three months ended March 31, 2026 As of and for the three months ended March 31, 2026

Return on average equity 16.06% 15.91% 6.43% - 16.05%

5 unchanged sentences

(2) Latest data available.

West Bancorporation, Inc.

Management's Discussion and Analysis

(dollars in thousands, except share and per share data)

At its meeting on April 22, 2026, the Company's Board of Directors declared a regular quarterly cash dividend of $0.25 per common share.

The dividend is payable on May 20, 2026, to stockholders of record on May 6, 2026.

At its meeting on July 22, 2026, the Company's Board of Directors declared a regular quarterly cash dividend of $0.26 per common share.

The dividend is payable on August 19, 2026, to stockholders of record on August 5, 2026.

West Bancorporation, Inc.

2 unchanged sentences

RESULTS OF OPERATIONS

The following table shows selected financial results and measures for the three months ended March 31, 2026 compared with the same period in 2025.

Three Months Ended March 31,

2026 2025 Change Change %

The following table shows selected financial results and measures for the three and six months ended June 30, 2026 compared with the same periods in 2025.

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 Change Change % 2026 2025 Change Change %

Net income $ 11,073 $ 7,979 $ 3,094 38.78 % $ 21,645 $ 15,821 $ 5,824 36.81 %

10 unchanged sentences

6.80 % 5.84 % 0.96 % 6.75 % 5.83 % 0.92 %

As of March 31,

As of June 30,

2026 2025 Change

21 unchanged sentences

Net Interest Income

The following table presents average balances and related interest income or interest expense, with the resulting annualized average yield or rate by category of interest-earning assets or interest-bearing liabilities.

The following tables present average balances and related interest income or interest expense, with the resulting annualized average yield or rate by category of interest-earning assets or interest-bearing liabilities.

Interest income and the resulting net interest income

are shown on a FTE basis.

Data for the three months ended March 31:

Data for the three months ended June 30:

Average Balance Interest Income/Expense Yield/Rate

14 unchanged sentences

Securities purchased under

agreements to resell 142,073 1,738 140,335 8,074.51 % 1,580 22 1,558 7,081.82 % 4.46 % 5.08 % (0.62) %

Total interest-earning assets (3)

$ 3,820,041 $ 3,799,081 $ 20,960 0.55 % 48,549 48,021 528 1.10 % 5.10 % 5.07 % 0.03 %

Interest-bearing liabilities:

Interest-bearing demand $ 482,219 $ 504,586 $ (22,367) (4.43) % 1,638 2,111 (473) (22.41) % 1.36 % 1.68 % (0.32) %

Savings and money market 1,842,052 1,721,968 120,084 6.97 % 13,088 14,034 (946) (6.74) % 2.85 % 3.27 % (0.42) %

Time deposits 492,973 623,994 (131,021) (21.00) % 4,458 6,531 (2,073) (31.74) % 3.63 % 4.20 % (0.57) %

Total interest-bearing deposits 2,817,244 2,850,548 (33,304) (1.17) % 19,184 22,676 (3,492) (15.40) % 2.73 % 3.19 % (0.46) %

Borrowed Funds:

Federal funds purchased and

other short-term borrowings — 1 (1) (100.00) % — — — — % — % 4.84 % (4.84) %

Subordinated notes, net 80,256 79,990 266 0.33 % 1,110 1,104 6 0.54 % 5.55 % 5.54 % 0.01 %

Federal Home Loan Bank

advances 270,000 270,000 — — % 2,274 2,259 15 0.66 % 3.38 % 3.36 % 0.02 %

Long-term debt 24,203 40,648 (16,445) (40.46) % 385 504 (119) (23.61) % 6.39 % 4.97 % 1.42 %

Total borrowed funds 374,459 390,639 (16,180) (4.14) % 3,769 3,867 (98) (2.53) % 4.04 % 3.97 % 0.07 %

Total interest-bearing

liabilities $ 3,191,703 $ 3,241,187 $ (49,484) (1.53) % 22,953 26,543 (3,590) (13.53) % 2.88 % 3.28 % (0.40) %

Net interest income (FTE) (4)

$ 25,596 $ 21,478 $ 4,118 19.17 %

Net interest spread (FTE) 2.22 % 1.79 % 0.43 %

Net interest margin (FTE) (4)

2.69 % 2.27 % 0.42 %

West Bancorporation, Inc.

Management's Discussion and Analysis

(dollars in thousands, except share and per share data)

Data for the six months ended June 30:

Average Balance Interest Income/Expense Yield/Rate

2026 2025 Change Change-

% 2026 2025 Change Change-

% 2026 2025 Change

Interest-earning assets:

Commercial $ 481,735 $ 530,156 $ (48,421) (9.13) % $ 15,015 $ 16,985 $ (1,970) (11.60) % 6.29 % 6.46 % (0.17) %

Real estate (3)

2,473,399 2,452,519 20,880 0.85 % 67,329 65,057 2,272 3.49 % 5.49 % 5.35 % 0.14 %

Consumer and other 22,915 20,130 2,785 13.84 % 707 671 36 5.37 % 6.22 % 6.72 % (0.50) %

Total loans 2,978,049 3,002,805 (24,756) (0.82) % 83,051 82,713 338 0.41 % 5.62 % 5.55 % 0.07 %

Taxable 356,267 430,075 (73,808) (17.16) % 4,240 5,473 (1,233) (22.53) % 2.38 % 2.55 % (0.17) %

Tax-exempt (3)

116,516 124,349 (7,833) (6.30) % 1,347 1,551 (204) (13.15) % 2.31 % 2.49 % (0.18) %

Total securities 472,783 554,424 (81,641) (14.73) % 5,587 7,024 (1,437) (20.46) % 2.36 % 2.53 % (0.17) %

Deposits with banks 225,969 200,384 25,585 12.77 % 4,177 4,464 (287) (6.43) % 3.73 % 4.49 % (0.76) %

Securities purchased under

agreements to resell 143,947 874 143,073 N/A 3,197 22 3,175 N/A 4.48 % 5.08 % (0.60) %

7 unchanged sentences

Borrowed funds:

Federal funds purchased and

other short-term borrowings — 1 (1) (100.00) % — — — — % — % 4.63 % (4.63) %

Subordinated notes, net 80,221 79,957 264 0.33 % 2,214 2,209 5 0.23 % 5.57 % 5.57 % — %

22 unchanged sentences

Interest rates earned and paid are also affected by general economic conditions, particularly changes in market interest rates, and by competitive factors, government policies and actions of regulatory authorities.

The FOMC decreased the target federal funds interest rate by a total of 75 basis points from September through December of 2025, which will impact the comparability of net interest margin between 2026 and 2025.

The FOMC decreased the target federal funds interest rate by a total of 75 basis points from September through December of 2025, which impacts the comparability of net interest margin between 2026 and 2025.

Net interest margin on a FTE basis, a non-GAAP financial measure, is a measure of the net return on interest-earning assets and is computed by dividing annualized tax-equivalent net interest income by total average interest-earning assets for the period.

The net interest margin for the three months ended March 31, 2026 increased 31 basis points compared to the three months ended March 31, 2025.

Tax-equivalent net interest income for the three months ended March 31, 2026 increased $3,536, when compared to the same period in 2025.

Tax-equivalent interest income on loans decreased $37 for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

The decrease in tax-equivalent interest income on loans during the three months ended March 31, 2026 compared to the same period in 2025 was driven primarily by a decrease in the average loan balances, partially offset by an increase in loan yields.

The average balance of loans for the three months ended March 31, 2026 decreased $44,621, compared to the three months ended March 31, 2025.

The yield on the loan portfolio increased by 7 basis points for the three months ended March 31, 2026 compared to the same period in 2025.

The net interest margin for the three and six months ended June 30, 2026 increased 42 and 37 basis points, respectively, compared to the three and six months ended June 30, 2025.

Tax-equivalent net interest income for the three and six months ended June 30, 2026 increased $4,118 and $7,654, respectively, when compared to the same periods in 2025.

Tax-equivalent interest income on loans increased $375 and $338, respectively, for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025.

The increase in tax-equivalent interest income on loans during the three and six months ended June 30, 2026 compared to the same periods in 2025 was driven primarily by an increase in loan yields, partially offset by a decrease in the average loan balances.

The yield on the loan portfolio increased by 6 and 7 basis points, respectively, for the three and six months ended June 30, 2026 compared to the same periods in 2025.

The average balance of loans for the three and six months ended June 30, 2026 decreased $5,111 and $24,756, respectively, compared to the three and six months ended June 30, 2025.

While the fixed-rate loan portfolio has benefited from higher prevailing market rates for originations and renewals compared to the roll-off rates, the yield on the variable-rate loan portfolio has decreased due to reductions in the prime rate and SOFR rates driven by the reductions in the federal funds rate since September 2025.

4 unchanged sentences

however, as long as market rates remain higher than the yield on the fixed-rate portfolio, renewals and originations will continue to increase the yield on the fixed-rate portfolio.

Tax-equivalent interest income on securities decreased $749 for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

Tax-equivalent interest income on securities decreased $688 and $1,437, respectively, for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025.

The decrease was primarily due to a decrease in average balances of securities.

This decrease in average balances of securities was driven by a sale of securities in November 2025 and calls and principal paydowns on securities.

Proceeds from the sale and principal paydowns have been reinvested in the loan portfolio, deposits with banks and securities purchased under agreements to resell.

Interest income on deposits with banks increased $430 for the three months ended March 31, 2026, compared to the three months ended March 31, 2025.

The increase was primarily due to the increase in the average balances of interest-bearing deposits with banks, partially offset by the decline in yield.

This increase in balance sheet liquidity was driven by the growth in average deposit balances.

Additionally, the Company began investing in securities purchased under agreements to resell in June 2025.

These produced interest income of $1,617 for the three months ended March 31, 2026.

Interest expense on deposits decreased $2,162 for the three months ended March 31, 2026, compared to the three months ended March 31, 2025.

The decrease in the interest expense on deposits was primarily due to the decline in interest rates paid on deposits of 40 basis points for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

In June 2025, the Company began investing in securities purchased under agreements to resell.

Changes in the yield on this short-term investment program, along with deposits in banks, are driven by changes in short-term market rates, including changes in the federal funds rate.

Interest expense on deposits decreased $3,492 and $5,654, respectively, for the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025.

The decrease in the interest expense on deposits was primarily due to the decline in interest rates paid on deposits of 46 and 43 basis points, respectively, for the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025.

The decrease in rates paid was primarily driven by the reductions in the federal funds rate since September of 2025.

The decline in interest rates paid on deposits was partially offset by the increase in average deposit balances.

The average balance of interest-bearing deposits increased $79,808 for the three months ended March 31, 2026 compared to the same period in 2025.

The average balance of interest-bearing deposits decreased $33,304 for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, and increased $22,940 for the six months ended June 30, 2026, compared to the six months ended June 30, 2025.

Interest expense on borrowed funds decreased $98 and $211, respectively, for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025.

The average balance of borrowed funds decreased $16,180 and $16,208, respectively, for the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025.

The largest driver of the decrease in average borrowed funds balances was the decrease in average balances on long-term debt, which decreased by $16,445 and $16,471, respectively for the three and six months ended June 30, 2026, compared to the same periods in 2025.

This decrease in average long-term debt balances was due to principal payments on the long-term debt.

West Bancorporation, Inc.

1 unchanged sentence

(dollars in thousands, except share and per share data)

Interest expense on borrowed funds decreased $113 for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

The average balance of borrowed funds decreased $16,236 for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

The largest driver of the decrease in average borrowed funds balances was the decrease in average balances on long-term debt, which decreased by $16,499 for the three months ended March 31, 2026, compared to the same period in 2025.

This decrease in average long-term debt balances was due to principal payments on the long-term debt.

Credit Loss Expense and the Related Allowance for Credit Losses

2 unchanged sentences

The allowance for credit losses is management's estimate of expected lifetime losses in the loan portfolio as of the balance sheet date.

The Company recorded no credit loss expense for loans or unfunded commitments for the three months ended March 31, 2026 and 2025.

Management believed the allowance for credit losses at March 31, 2026 was adequate to absorb expected losses in the loan portfolio as of that date.

The Company recorded no credit loss expense for loans or unfunded commitments for the three and six months ended June 30, 2026 and 2025.

Management believed the allowance for credit losses at June 30, 2026 was adequate to absorb expected losses in the loan portfolio as of that date.

Factors management considers in establishing an appropriate allowance include:

27 unchanged sentences

Commercially reasonable efforts are made to maximize subsequent recoveries.

The following table summarizes the activity in the Company's allowance for credit losses on loans for the three months ended March 31, 2026 and 2025 and related ratios.

Three Months Ended March 31,

2026 2025 Change

The following table summarizes the activity in the Company's allowance for credit losses on loans for the three and six months ended June 30, 2026 and 2025 and related ratios.

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 Change 2026 2025 Change

Balance at beginning of period $ 30,523 $ 30,526 $ (3) $ 30,525 $ 30,432 $ 93

7 unchanged sentences

Ratio of annualized net (charge-offs)

recoveries during the period to average

loans outstanding 0.00 % 0.01 %

recoveries during the period to

average loans outstanding 0.00 % 0.00 % 0.00 % 0.01 %

Ratio of allowance for credit losses for

6 unchanged sentences

Noninterest Income

The following table shows the variance from the prior year in the noninterest income categories shown in the Consolidated Statements of Income.

Three Months Ended March 31,

The following tables show the variance from the prior year in the noninterest income categories shown in the Consolidated Statements of Income.

Three Months Ended June 30,

Noninterest income:

6 unchanged sentences

Total noninterest income $ 2,596 $ 2,410 $ 186 7.72 %

The increase in trust services revenue in the three months ended March 31, 2026 compared to the same period in 2025 was primarily due to the increase in trust assets and trust accounts since March 31, 2025.

Six Months Ended June 30,

Noninterest income:

2026 2025 Change Change %

Service charges on deposit accounts $ 984 $ 957 $ 27 2.82 %

Debit card interchange income 986 924 62 6.71 %

Trust services 2,058 1,578 480 30.42 %

Increase in cash value of bank-owned life insurance 621 577 44 7.63 %

Other income 501 617 (116) (18.80) %

Total noninterest income $ 5,150 $ 4,653 $ 497 10.68 %

The increase in trust services revenue in the three and six months ended June 30, 2026, compared to the same periods in 2025, was primarily due to the growth in trust assets and trust accounts since June 30, 2025.

West Bancorporation, Inc.

Management's Discussion and Analysis

(dollars in thousands, except share and per share data)

Noninterest Expense

The following table shows the variance from the prior year in the noninterest expense categories shown in the Consolidated Statements of Income.

The following tables show the variance from the prior year in the noninterest expense categories shown in the Consolidated Statements of Income.

In addition, accounts within the “other expenses” category that represent a significant portion of the total or a significant variance are shown below.

Three Months Ended March 31,

Three Months Ended June 30,

Noninterest expense:

2 unchanged sentences

Occupancy and equipment 2,006 2,034 (28) (1.38) %

Data processing 596 617 (21) (3.40) %

Technology and software 822 791 31 3.92 %

Data processing 545 643 (98) (15.24) %

FDIC insurance 444 670 (226) (33.73) %

1 unchanged sentence

Other expenses:

Trust 243 202 41 20.30 %

Business development 270 199 71 35.68 %

Insurance expense 235 291 (56) (19.24) %

Trust 214 175 39 22.29 %

Consulting fees 62 52 10 19.23 %

Marketing 32 25 7 28.00 %

Low income housing projects amortization 136 134 2 1.49 %

New markets tax credit project amortization and management

fees — 76 (76) (100.00) %

All other 716 749 (33) (4.41) %

Total other expenses 1,665 1,701 (36) (2.12) %

Total noninterest expense $ 13,767 $ 13,485 $ 282 2.09 %

Six Months Ended June 30,

Noninterest expense:

2026 2025 Change Change %

Salaries and employee benefits $ 15,619 $ 14,347 $ 1,272 8.87 %

Occupancy and equipment 4,012 3,997 15 0.38 %

Technology and software 1,596 1,577 19 1.20 %

Data processing 1,141 1,260 (119) (9.44) %

FDIC insurance 917 1,257 (340) (27.05) %

Professional fees 576 611 (35) (5.73) %

Other expenses:

Business development 506 414 92 22.22 %

Insurance expense 474 585 (111) (18.97) %

Trust 457 377 80 21.22 %

Consulting fees 135 131 4 3.05 %

6 unchanged sentences

Total noninterest expense $ 27,232 $ 26,548 $ 684 2.58 %

Salaries and employee benefits increased for the three months ended March 31, 2026 compared to the same period in 2025 due to the combination of normal merit increases and an increase in full-time equivalent employees since March 31, 2025.

FDIC insurance expense decreased for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to a decrease in the assessment rate.

Salaries and employee benefits increased for the three and six months ended June 30, 2026, compared to the same periods in 2025, due to normal annual merit increases and an increase in incentive compensation related accruals.

FDIC insurance expense decreased for the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025, primarily due to a decrease in the assessment rate.

New markets tax credit project amortization declined with the expiration of the related tax credit.

3 unchanged sentences

Income Tax Expense

The Company recorded income tax expense of $2,902 (21.5 percent of pre-tax income) for the three months ended March 31, 2026, compared with $2,193 (21.9 percent of pre-tax income) for the three months ended March 31, 2025.

The tax rates for the first three months of 2026 and 2025 were impacted by total year-to-date tax credits of approximately $140 and $165, respectively.

The Company recorded income tax expense of $3,277 (22.8 percent of pre-tax income) and $6,179 (22.2 percent of pre-tax income) for the three and six months ended June 30, 2026, respectively, compared with $2,365 (22.9 percent of pre-tax income) and $4,558 (22.4 percent of pre-tax income) for the three and six months ended June 30, 2025, respectively.

The tax rates for the first six months of 2026 and 2025 were impacted by total year-to-date tax credits of approximately $280 and $330, respectively.

The Company's consolidated income tax rate differs from the federal statutory income tax rate in each period, primarily due to tax-exempt interest income, the tax-exempt increase in cash value of bank-owned life insurance, disallowed interest expense, and state income taxes.

Additionally, for the three months ended March 31, 2026 and 2025, a tax benefit of $211 and $67, respectively, was recorded as a result of the increase in fair value of restricted stock over the vesting period.

Additionally, for the six months ended June 30, 2026 and 2025, a tax benefit of $243 and $85, respectively, was recorded as a result of the increase in fair value of restricted stock over the vesting period.

West Bancorporation, Inc.

2 unchanged sentences

FINANCIAL CONDITION

The Company had total assets of $4,010,973 as of March 31, 2026, compared to total assets of $4,142,244 as of December 31, 2025.

The Company had total assets of $4,029,664 as of June 30, 2026, compared to total assets of $4,142,244 as of December 31, 2025.

Changes in the balance sheet included increases in securities purchased under agreements to resell and stockholders' equity and decreases in interest-earning deposits in banks, securities available for sale, loans and deposits.

Cash and Cash Equivalents

As of March 31, 2026, the Company held securities purchased under agreements to resell of $141,742 compared to $121,413 at December 31, 2025.

As of June 30, 2026, the Company held securities purchased under agreements to resell of $142,080 compared to $121,413 at December 31, 2025.

The Company uses these instruments as short-term secured investments which have monthly maturities.

Balances will fluctuate based on the Company's liquidity and investment strategies.

Securities available for sale decreased by $12,037 during the three months ended March 31, 2026.

Securities available for sale decreased by $21,872 during the six months ended June 30, 2026.

This decrease was due to calls and principal paydowns on securities and an increase in unrealized losses on securities since December 31, 2025.

Management concluded unrealized losses in the portfolio as of March 31, 2026 are the result of increases in risk-free market interest rates since the securities were purchased and are not an indication of declining credit quality.

Management concluded unrealized losses in the portfolio as of June 30, 2026 are the result of increases in risk-free market interest rates since the securities were purchased and are not an indication of declining credit quality.

Unrealized losses are recorded in accumulated other comprehensive loss, net of tax.

As of March 31, 2026, approximately 62 percent of the available for sale securities portfolio consisted of government agency guaranteed collateralized mortgage obligations and mortgage-backed securities.

As of June 30, 2026, approximately 61 percent of the available for sale securities portfolio consisted of government agency guaranteed collateralized mortgage obligations and mortgage-backed securities.

Management believes these securities have little to no credit risk and provide cash flows for liquidity and repricing opportunities.

Loans and Nonperforming Assets

Loans outstanding decreased $10,052 from $3,001,690 as of December 31, 2025 to $2,991,638 as of March 31, 2026.

Changes in the loan portfolio during the first three months of 2026 included decreases of $50,774 in construction, land and land development loans and $33,636 in commercial loans and increases of $45,996 in 1-4 family residential first mortgage loans and $28,423 in commercial real estate loans.

Loans outstanding decreased $51,576 from $3,001,690 as of December 31, 2025 to $2,950,114 as of June 30, 2026.

Changes in the loan portfolio during the first six months of 2026 included decreases of $93,080 in construction, land and land development loans and $41,811 in commercial loans and increases of $47,711 in commercial real estate loans and $37,829 in 1-4 family residential first mortgage loans.

We continue to experience notable loan payoffs as a result of secondary market refinancings and asset and business sales.

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In accordance with regulatory guidelines, the Company exercises heightened risk management practices when non-owner occupied commercial real estate lending exceeds 300 percent of total risk-based capital or construction, land and land development loans exceed 100 percent of total risk-based capital.

Although the commercial real estate portfolio exceeded these regulatory guidelines as of March 31, 2026, they were within the Company's established policy limits and management believes that the Company has appropriate risk management policies and procedures to regularly monitor the commercial real estate portfolio.

Although the commercial real estate portfolio exceeded these regulatory guidelines as of June 30, 2026, they were within the Company's established policy limits and management believes that the Company has appropriate risk management policies and procedures to regularly monitor the commercial real estate portfolio.

An analysis of the Company's non-owner occupied commercial real estate portfolio as of December 31, 2025 was presented in the Company's Annual Report on Form 10-K, filed with the SEC on February 26, 2026, and the Company has not experienced any material changes to that portfolio since December 31, 2025.

The Company had no nonaccrual loans or loans past due 90 days and still accruing interest as of March 31, 2026 and December 31, 2025.

Additionally, the Company had no loan restructurings or other real estate owned as of March 31, 2026 and December 31, 2025.

Deposits decreased $133,498, or 3.8 percent, during the first three months of 2026.

Brokered deposits decreased to $116,476 at March 31, 2026, from $154,564 at December 31, 2025.

Excluding brokered deposits, deposits decreased $95,410, or 2.9 percent, during the first three months of 2026.

The Company had no nonaccrual loans or loans past due 90 days and still accruing interest as of June 30, 2026 and December 31, 2025.

Additionally, the Company had no other real estate owned as of June 30, 2026 and December 31, 2025.

Deposits decreased $123,570, or 3.6 percent, during the first six months of 2026.

Brokered deposits decreased to $110,450 at June 30, 2026, from $154,564 at December 31, 2025.

Excluding brokered deposits, deposits decreased $79,456, or 2.4 percent, during the first six months of 2026.

The decline in deposits was due to normal cash flow fluctuations of our core depositors.

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West Bank participates in a reciprocal deposit network which enables depositors to receive FDIC insurance coverage on deposits otherwise exceeding the maximum insurable amount.

As of March 31, 2026, estimated uninsured deposits, which exclude deposits in reciprocal deposit networks, brokered deposits and public funds protected by state programs, were approximately 27.0 percent of total deposits.

As of June 30, 2026, estimated uninsured deposits, which exclude deposits in reciprocal deposit networks, brokered deposits and public funds protected by state programs, were approximately 27.2 percent of total deposits.

Borrowed Funds

The Company had $270,000 of FHLB advances outstanding at March 31, 2026, all of which are one-month rolling advances hedged with long-term interest rate swaps.

The Company had $270,000 of FHLB advances outstanding at June 30, 2026, all of which are one-month rolling advances hedged with long-term interest rate swaps.

The interest rate swaps that hedge the interest rates on these FHLB advances have maturity dates ranging from July 2026 through June 2029 and fixed rates ranging from 1.86 percent to 4.32 percent.

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Investments in liquid assets are adjusted based on expected loan demand, projected loan and security maturities and payments, expected deposit flows and the objectives set by the Company's asset-liability management policy.

The Company had liquid assets (cash and cash equivalents) of $361,978 as of March 31, 2026 compared with $471,086 as of December 31, 2025.

The Company had liquid assets (cash and cash equivalents) of $433,699 as of June 30, 2026, compared with $471,086 as of December 31, 2025.

Our deposit growth strategy emphasizes core deposit growth.

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The Company utilizes brokered deposits and other wholesale funding to supplement core deposit fluctuations and loan growth.

At March 31, 2026, the Company had $116,476 in brokered deposits, which included fixed-rate deposits with terms through September 2026 and variable-rate deposits with terms through February 2027.

As of March 31, 2026, West Bank had additional borrowing capacity available from the FHLB of approximately $674,000, as well as approximately $37,000 through the Federal Reserve discount window and $75,000 through unsecured federal funds lines of credit with correspondent banks.

Net cash from operating activities contributed $12,885 to liquidity for the three months ended March 31, 2026.

Management believed that the combination of high levels of liquid assets, unencumbered securities, cash flows from operations, and additional borrowing capacity were sufficient to meet our liquidity needs as of March 31, 2026.

The Company had remaining commitments to invest in qualified affordable housing projects totaling $1,329 and $1,383 as of March 31, 2026 and December 31, 2025, respectively.

The Company's total stockholders' equity increased to $270,743 at March 31, 2026 from $265,985 at December 31, 2025.

At June 30, 2026, the Company had $110,450 in brokered deposits, which included fixed-rate deposits with terms through September 2027 and variable-rate deposits with terms through February 2027.

As of June 30, 2026, West Bank had additional borrowing capacity available from the FHLB of approximately $675,000, as well as approximately $36,000 through the Federal Reserve discount window and $75,000 through unsecured federal funds lines of credit with correspondent banks.

Net cash from operating activities contributed $27,251 to liquidity for the six months ended June 30, 2026.

The Company had remaining commitments to invest in qualified affordable housing projects totaling $1,270 and $1,383 as of June 30, 2026 and December 31, 2025, respectively.

The Company's total stockholders' equity increased to $281,042 at June 30, 2026 from $265,985 at December 31, 2025.

The increase was primarily the result of growth in retained earnings.

At March 31, 2026, the Company's tangible common equity as a percent of tangible assets was 6.75 percent, compared to 6.42 percent as of December 31, 2025.

At June 30, 2026, the Company's tangible common equity as a percent of tangible assets was 6.97 percent, compared to 6.42 percent as of December 31, 2025.

The Company and West Bank are subject to various regulatory capital requirements administered by federal and state banking agencies.

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The Company's and West Bank's capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Management believed the Company and West Bank met all capital adequacy requirements to which they were subject as of March 31, 2026.

Management believed the Company and West Bank met all capital adequacy requirements to which they were subject as of June 30, 2026.

West Bancorporation, Inc.

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Amount Ratio Amount Ratio Amount Ratio Amount Ratio

As of March 31, 2026

As of June 30, 2026

Total Capital (to Risk-Weighted Assets)

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A banking organization with a capital conservation buffer of less than the required amount will be subject to limitations on capital distributions, including dividend payments, and certain discretionary bonus payments to executive officers.

At March 31, 2026, the capital ratios for the Company and West Bank were sufficient to meet the conservation buffer.

At June 30, 2026, the capital ratios for the Company and West Bank were sufficient to meet the conservation buffer.

(dollars in thousands, except share and per share data)

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis