WABC Westamerica Bancorporation

Westamerica Bancorporation (Nasdaq: WABC), parent company of Westamerica Bank, generated net income for the third quarter 2022 of $34.8 million and diluted earnings per common share ("EPS") of $1.29, including a life insurance gain equivalent to EPS of $0.03. Third quarter 2022 net income was 37 percent higher than second quarter 2022 net income of $25.3 million and EPS of $0.94.

"Westamerica’s third quarter 2022 results benefited from the Company’s variable-rate bonds, cash and loans, as well as our valuable deposit base. With 47 percent of average deposits represented by non-interest bearing checking accounts and limited reliance on time deposits, the cost of funding our loan and bond portfolios was 0.03 percent in the third quarter 2022, unchanged from the prior quarter. Operating expenses were well controlled and credit quality remained solid,” said Chairman, President and CEO David Payne. “Third quarter 2022 results generated an annualized 17.1 percent return on average common equity. Shareholders were paid a $0.42 per common share dividend during the third quarter 2022,” concluded Payne.

Net interest income on a fully-taxable equivalent (FTE) basis was $60.8 million for the third quarter 2022, compared to $48.0 million for the second quarter 2022. The yield earned on loans and bonds for the third quarter 2022 was 3.47 percent, up from 2.77 percent for the second quarter 2022. The cost of funding the loan and bond portfolios was 0.03 percent for both the third quarter and second quarter of 2022. Variable rate assets at September 30, 2022 included $1.6 billion in collateralized loan obligations for which interest rates reset quarterly, and $304.1 million in interest-bearing cash balances for which the interest rate changes concurrently with Federal Open Market Committee adjustments to the federal funds rate.

Noninterest income for the third quarter 2022 totaled $11.8 million, including a $923 thousand life insurance gain. Noninterest income for the second quarter 2022 was $11.3 million.

Noninterest expenses for the third quarter 2022 were $24.8 million compared to $24.6 million for the second quarter 2022.

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 – SVP & Treasurer707-863-6840investments@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, 2021 filed on Form 10-K and quarterly report for the quarter ended June 30, 2022 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.

WESTAMERICA BANCORPORATIONFINANCIAL HIGHLIGHTSSeptember 30, 2022

1. Net Income Summary.
		(in thousands except per-share amounts)
								%
		Q3'2022			Q3'2021			Change		Q2'2022
	Net Interest and Fee Income (FTE)	$	60,780		$	43,952		38.3	%	$	48,033
	Provision for Credit Losses		-			-		n/m			-
	Noninterest Income		11,818			11,282		4.8	%		11,264
	Noninterest Expense		24,767			24,697		0.3	%		24,629
	Income Before Taxes (FTE)		47,831			30,537		56.6	%		34,668
	Income Tax Provision (FTE)		13,071			8,474		54.2	%		9,354
	Net Income	$	34,760		$	22,063		57.5	%	$	25,314
	Average Common Shares Outstanding		26,906			26,866		0.1	%		26,889
	Diluted Average Common Shares		26,916			26,875		0.2	%		26,901
	Operating Ratios:
	Basic Earnings Per Common Share	$	1.29		$	0.82		57.3	%	$	0.94
	Diluted Earnings Per Common Share		1.29			0.82		57.3	%		0.94
	Return On Assets (a)		1.85	%		1.22	%				1.37	%
	Return On Common Equity (a)		17.1	%		11.6	%				12.9	%
	Net Interest Margin (FTE) (a)		3.44	%		2.60	%				2.74	%
	Efficiency Ratio (FTE)		34.1	%		44.7	%				41.5	%
	Dividends Paid Per Common Share	$	0.42		$	0.41		2.4	%	$	0.42
	Common Dividend Payout Ratio		33	%		50	%				45	%
								%
		9/30'22YTD			9/30'21YTD			Change
	Net Interest and Fee Income (FTE)	$	152,620		$	131,034		16.5	%
	Provision for Credit Losses		-			-		n/m
	Noninterest Income (1)		34,658			32,503		6.6	%
	Noninterest Expense		74,271			73,894		0.5	%
	Income Before Taxes (FTE)		113,007			89,643		26.1	%
	Income Tax Provision (FTE)		30,317			24,854		22.0	%
	Net Income	$	82,690		$	64,789		27.6	%
	Average Common Shares Outstanding		26,889			26,851		0.1	%
	Diluted Average Common Shares		26,901			26,868		0.1	%
	Operating Ratios:
	Basic Earnings Per Common Share	$	3.08		$	2.41		27.8	%
	Diluted Earnings Per Common Share		3.07			2.41		27.4	%
	Return On Assets (a)		1.49	%		1.25	%
	Return On Common Equity (a)		14.0	%		11.6	%
	Net Interest Margin (FTE) (a)		2.90	%		2.67	%
	Efficiency Ratio (FTE)		39.7	%		45.2	%
	Dividends Paid Per Common Share	$	1.26		$	1.23		2.4	%
	Common Dividend Payout Ratio		41	%		51	%

2. Net Interest Income.
		(dollars in thousands)
								%
		Q3'2022			Q3'2021			Change		Q2'2022
	Interest and Fee Income (FTE)	$	61,267		$	44,444		37.9	%	$	48,516
	Interest Expense		487			492		-1.0	%		483
	Net Interest and Fee Income (FTE)	$	60,780		$	43,952		38.3	%	$	48,033
	Average Earning Assets	$	7,041,313		$	6,754,281		4.2	%	$	7,000,862
	Average Interest-Bearing Liabilities		3,520,083			3,370,840		4.4	%		3,549,140
	Yield on Earning Assets (FTE) (a)		3.47	%		2.63	%				2.77	%
	Cost of Funds (a)		0.03	%		0.03	%				0.03	%
	Net Interest Margin (FTE) (a)		3.44	%		2.60	%				2.74	%
	Interest Expense/Interest-Bearing Liabilities (a)		0.05	%		0.06	%				0.05	%
	Net Interest Spread (FTE) (a)		3.42	%		2.57	%				2.72	%
								%
		9/30'22YTD			9/30'21YTD			Change
	Interest and Fee Income (FTE)	$	154,070		$	132,485		16.3	%
	Interest Expense		1,450			1,451		-0.1	%
	Net Interest and Fee Income (FTE)	$	152,620		$	131,034		16.5	%
	Average Earning Assets	$	7,013,627		$	6,535,949		7.3	%
	Average Interest-Bearing Liabilities		3,538,361			3,267,311		8.3	%
	Yield on Earning Assets (FTE) (a)		2.93	%		2.70	%
	Cost of Funds (a)		0.03	%		0.03	%
	Net Interest Margin (FTE) (a)		2.90	%		2.67	%
	Interest Expense/Interest-Bearing Liabilities (a)		0.05	%		0.06	%
	Net Interest Spread (FTE) (a)		2.88	%		2.64	%

3. Loans & Other Earning Assets.
		(average volume, dollars in thousands)
								%
		Q3'2022			Q3'2021			Change		Q2'2022
	Total Assets	$	7,472,304		$	7,158,462		4.4	%	$	7,420,069
	Total Earning Assets		7,041,313			6,754,281		4.2	%		7,000,862
	Total Loans		989,033			1,176,114		-15.9	%		1,009,633
	Total Commercial Loans		190,325			333,327		-42.9	%		202,585
	Paycheck Protection Program (PPP) Loans		10,453			144,641		-92.8	%		20,997
	Commercial Loans		179,872			188,686		-4.7	%		181,588
	Commercial RE Loans		494,717			543,429		-9.0	%		508,003
	Consumer Loans		303,991			299,358		1.5	%		299,045
	Total Investment Securities		5,552,588			4,615,540		20.3	%		5,008,929
	Debt Securities Available For Sale		4,845,055			4,235,141		14.4	%		4,721,083
	Debt Securities Held To Maturity		707,533			380,399		86.0	%		287,846
	Total Interest-Bearing Cash		499,692			962,627		-48.1	%		982,300
	Loans/Deposits		15.2	%		18.9	%				15.7	%
								%
		9/30'22YTD			9/30'21YTD			Change
	Total Assets	$	7,433,140		$	6,939,636		7.1	%
	Total Earning Assets		7,013,627			6,535,949		7.3	%
	Total Loans		1,009,314			1,227,971		-17.8	%
	Total Commercial Loans		200,206			380,638		-47.4	%
	PPP Loans		22,347			180,214		-87.6	%
	Commercial Loans		177,859			200,424		-11.3	%
	Commercial RE Loans		508,812			549,639		-7.4	%
	Consumer Loans		300,296			297,694		0.9	%
	Total Investment Securities		5,172,003			4,484,084		15.3	%
	Debt Securities Available For Sale		4,741,400			4,046,289		17.2	%
	Debt Securities Held To Maturity		430,603			437,795		-1.6	%
	Total Interest-Bearing Cash		832,310			823,894		1.0	%
	Loans/Deposits		15.7	%		20.4	%

4. Deposits, Other Interest-Bearing Liabilities & Equity.
		(average volume, dollars in thousands)
								%
		Q3'2022			Q3'2021			Change		Q2'2022
	Total Deposits	$	6,495,051		$	6,223,500		4.4	%	$	6,424,202
	Noninterest Demand		3,058,662			2,960,207		3.3	%		2,998,360
	Interest-Bearing Transaction		1,308,310			1,246,667		4.9	%		1,298,665
	Savings		1,989,275			1,864,401		6.7	%		1,985,325
	Time greater than $100K		62,014			68,811		-9.9	%		63,790
	Time less than $100K		76,790			83,414		-7.9	%		78,062
	Total Short-Term Borrowings		83,694			107,547		-22.2	%		123,298
	Shareholders' Equity		807,428			755,682		6.8	%		788,078
	Demand Deposits/
	Total Deposits		47.1	%		47.6	%				46.7	%
	Transaction & Savings
	Deposits / Total Deposits		97.9	%		97.6	%				97.8	%
								%
		9/30'22YTD			9/30'21YTD			Change
	Total Deposits	$	6,437,943		$	6,017,175		7.0	%
	Noninterest Demand		3,020,892			2,854,936		5.8	%
	Interest-Bearing Transaction		1,290,850			1,195,762		8.0	%
	Savings		1,984,931			1,811,711		9.6	%
	Time greater than $100K		63,318			70,258		-9.9	%
	Time less than $100K		77,952			84,508		-7.8	%
	Total Short-Term Borrowings		121,310			105,001		15.5	%
	Other Borrowed Funds		-			71		n/m
	Shareholders' Equity		790,691			745,382		6.1	%
	Demand Deposits/
	Total Deposits		46.9	%		47.4	%
	Transaction & Savings
	Deposits / Total Deposits		97.8	%		97.4	%

5. Interest Yields Earned & Rates Paid.
		(dollars in thousands)
		Q3'2022
		Average		Income/		Yield (a) /
		Volume		Expense		Rate (a)
	Interest & Fee Income Earned
	Total Earning Assets (FTE)	$	7,041,313	$	61,267	3.47	%
	Total Loans (FTE)		989,033		12,298	4.93	%
	Total Commercial Loans (FTE)		190,325		2,843	5.93	%
	PPP Loans		10,453		533	20.24	%
	Commercial Loans (FTE)		179,872		2,310	5.10	%
	Commercial RE Loans		494,717		5,821	4.67	%
	Consumer Loans		303,991		3,634	4.74	%
	Total Investments (FTE)		5,552,588		46,227	3.33	%
	Total Debt Securities Available For Sale (FTE)		4,845,055		39,388	3.22	%
	Corporate Securities		2,518,870		17,404	2.76	%
	Collateralized Loan Obligations		1,600,611		16,355	4.00	%
	Agency Mortgage Backed Securities		336,392		2,001	2.38	%
	Securities of U.S. Government sponsored entities		288,538		2,604	3.61	%
	Obligations of States and Political Subdivisions (FTE)		86,357		660	3.06	%
	Other Debt Securities Available For Sale (FTE)		14,287		364	10.18	%
	Total Debt Securities Held To Maturity (FTE)		707,533		6,839	3.87	%
	Agency Mortgage Backed Securities		117,606		586	1.99	%
	Corporate Securities		477,881		5,230	4.38	%
	Obligations of States and Political Subdivisions (FTE)		112,046		1,023	3.65	%
	Total Interest-Bearing Cash		499,692		2,742	2.15	%
	Interest Expense Paid
	Total Earning Assets		7,041,313		487	0.03	%
	Total Interest-Bearing Liabilities		3,520,083		487	0.05	%
	Total Interest-Bearing Deposits		3,436,389		470	0.05	%
	Interest-Bearing Transaction		1,308,310		94	0.03	%
	Savings		1,989,275		290	0.06	%
	Time less than $100K		76,790		47	0.24	%
	Time greater than $100K		62,014		39	0.25	%
	Total Short-Term Borrowings		83,694		17	0.08	%
	Net Interest Income and Margin (FTE)			$	60,780	3.44	%
		Q3'2021
		Average		Income/		Yield (a) /
		Volume		Expense		Rate (a)
	Interest & Fee Income Earned
	Total Earning Assets (FTE)	$	6,754,281	$	44,444	2.63	%
	Total Loans (FTE)		1,176,114		14,893	5.02	%
	Total Commercial Loans (FTE)		333,327		3,866	4.60	%
	PPP Loans		144,641		1,865	5.12	%
	Commercial Loans (FTE)		188,686		2,001	4.21	%
	Commercial RE Loans		543,429		7,457	5.44	%
	Consumer Loans		299,358		3,570	4.73	%
	Total Investments (FTE)		4,615,540		29,182	2.53	%
	Total Debt Securities Available For Sale (FTE)		4,235,141		26,736	2.51	%
	Corporate Securities		2,506,856		17,974	2.87	%
	Collateralized Loan Obligations		1,148,445		5,631	1.92	%
	Agency Mortgage Backed Securities		470,250		2,022	1.72	%
	Obligations of States and Political Subdivisions (FTE)		95,229		747	3.14	%
	Other Debt Securities Available For Sale (FTE)		14,361		362	10.09	%
	Total Debt Securities Held To Maturity (FTE)		380,399		2,446	2.57	%
	Agency Mortgage Backed Securities		178,381		753	1.69	%
	Obligations of States and Political Subdivisions (FTE)		202,018		1,693	3.35	%
	Total Interest-Bearing Cash		962,627		369	0.15	%
	Interest Expense Paid
	Total Earning Assets		6,754,281		492	0.03	%
	Total Interest-Bearing Liabilities		3,370,840		492	0.06	%
	Total Interest-Bearing Deposits		3,263,293		473	0.06	%
	Interest-Bearing Transaction		1,246,667		101	0.03	%
	Savings		1,864,401		272	0.06	%
	Time less than $100K		83,414		42	0.20	%
	Time greater than $100K		68,811		58	0.33	%
	Total Short-Term Borrowings		107,547		19	0.07	%
	Net Interest Income and Margin (FTE)			$	43,952	2.60	%

6. Noninterest Income.
		(dollars in thousands except per-share amounts)
								%
		Q3'2022			Q3'2021			Change		Q2'2022
	Service Charges on Deposits	$	3,737		$	3,578		4.4	%	$	3,687
	Merchant Processing Services		2,925			3,159		-7.4	%		3,374
	Debit Card Fees		1,594			1,740		-8.4	%		1,709
	Trust Fees		810			839		-3.5	%		809
	ATM Processing Fees		594			573		3.7	%		469
	Other Service Fees		463			475		-2.6	%		480
	Financial Services Commissions		79			95		-16.8	%		118
	Life Insurance Gains		923			-		n/m			-
	Other Noninterest Income		693			823		-15.8	%		618
	Total Noninterest Income	$	11,818		$	11,282		4.8	%	$	11,264
	Total Revenue (FTE)	$	72,598		$	55,234		31.4	%	$	59,297
	Noninterest Income/Revenue (FTE)		16.3	%		20.4	%				19.0	%
	Service Charges/Avg. Deposits (a)		0.23	%		0.23	%				0.23	%
	Total Revenue (FTE) Per Avg. Common Share (a)	$	10.70		$	8.16		31.2	%	$	8.85
								%
		9/30'22YTD			9/30'21YTD			Change
	Service Charges on Deposits	$	11,006		$	10,117		8.8	%
	Merchant Processing Services		8,922			8,998		-0.8	%
	Debit Card Fees (1)		6,175			5,132		20.3	%
	Trust Fees		2,462			2,467		-0.2	%
	ATM Processing Fees		1,514			1,792		-15.5	%
	Other Service Fees		1,392			1,435		-3.0	%
	Financial Services Commissions		314			260		20.8	%
	Life Insurance Gains		923			-		n/m
	Securities Gains		-			34		n/m
	Other Noninterest Income		1,950			2,268		-14.0	%
	Total Noninterest Income	$	34,658		$	32,503		6.6	%
	Total Revenue (FTE)	$	187,278		$	163,537		14.5	%
	Noninterest Income/Revenue (FTE)		18.5	%		19.9	%
	Service Charges/Avg. Deposits (a)		0.23	%		0.22	%
	Total Revenue (FTE) Per Avg./Common Share (a)	$	9.31		$	8.14		14.4	%

7. Noninterest Expense.
		(dollars in thousands)
								%
		Q3'2022			Q3'2021			Change		Q2'2022
	Salaries & Benefits	$	11,311		$	11,813		-4.2	%	$	11,412
	Occupancy and Equipment		5,064			4,759		6.4	%		4,856
	Outsourced Data Processing		2,434			2,429		0.2	%		2,423
	Limited Partnership Operating Losses		1,431			620		130.8	%		1,431
	Professional Fees		582			724		-19.6	%		736
	Courier Service		671			534		25.7	%		661
	Other Noninterest Expense		3,274			3,818		-14.2	%		3,110
	Total Noninterest Expense	$	24,767		$	24,697		0.3	%	$	24,629
	Noninterest Expense/Avg. Earning Assets (a)		1.40	%		1.45	%				1.41	%
	Noninterest Expense/Revenues (FTE)		34.1	%		44.7	%				41.5	%
								%
		9/30'22YTD			9/30'21YTD			Change
	Salaries & Benefits	$	34,643		$	36,575		-5.3	%
	Occupancy and Equipment		14,666			14,447		1.5	%
	Outsourced Data Processing		7,294			7,244		0.7	%
	Limited Partnership Operating Losses		4,293			1,820		135.9	%
	Professional Fees		2,054			2,496		-17.7	%
	Courier Service		1,914			1,605		19.3	%
	Other Noninterest Expense		9,407			9,707		-3.1	%
	Total Noninterest Expense	$	74,271		$	73,894		0.5	%
	Noninterest Expense/Avg. Earning Assets (a)		1.42	%		1.51	%
	Noninterest Expense/Revenues (FTE)		39.7	%		45.2	%

8. Allowance for Credit Losses.
		(dollars in thousands)
								%
		Q3'2022			Q3'2021			Change		Q2'2022
	Average Total Loans	$	989,033		$	1,176,114		-15.9	%	$	1,009,633
	Beginning of Period Allowance for Credit Losses on Loans (ACLL)	$	22,313		$	23,737		-6.0	%	$	22,925
	Provision for Credit Losses		-			2		n/m			-
	Net ACLL (Losses) Recoveries		(1,095	)		143		n/m			(612	)
	End of Period ACLL	$	21,218		$	23,882		-11.2	%	$	22,313
	Gross ACLL Recoveries / Gross ACLL Losses		43	%		115	%				57	%
	Net ACLL Losses (Recoveries) / Avg. Total Loans (a)		0.44	%		(0.05	%)				0.24	%
								%
		9/30'22YTD			9/30'21YTD			Change
	Average Total Loans	$	1,009,314		$	1,227,971		-17.8	%
	Beginning of Period ACLL	$	23,514		$	23,854		-1.4	%
	Provision for Credit Losses		-			2		n/m
	Net ACLL (Losses) Recoveries		(2,296	)		26		n/m
	End of Period ACLL	$	21,218		$	23,882		-11.2	%
	Gross ACLL Recoveries / Gross ACLL Losses		49	%		101	%
	Net ACLL Losses (Recoveries) / Avg. Total Loans (a)		0.30	%		0.00	%
		(dollars in thousands)
								%
		9/30/22			9/30/21			Change		6/30/22
	Allowance for Credit Losses on Loans	$	21,218		$	23,882		-11.2	%	$	22,313
	Allowance for Credit Losses on HTM Securities		7			7		0.0	%		7
	Total Allowance for Credit Losses	$	21,225		$	23,889		-11.2	%	$	22,320
	Allowance for Unfunded Credit Commitments	$	201		$	101		99.3	%	$	201

9. Credit Quality.
		(dollars in thousands)
								%
		9/30/22			9/30/21			Change		6/30/22
	Nonperforming Loans:
	Nonperforming Nonaccrual	$	131		$	801		-83.6	%	$	12
	Performing Nonaccrual		66			436		-84.9	%		235
	Total Nonaccrual Loans		197			1,237		-84.1	%		247
	90+ Days Past Due Accruing Loans		769			537		43.2	%		614
	Total Nonperforming Loans	$	966		$	1,774		-45.5	%	$	861
	Total Loans Outstanding	$	979,033		$	1,132,472		-13.5	%	$	999,768
	Total Assets		7,177,025			7,403,573		-3.1	%		7,222,405
	Loans:
	Allowance for Credit Losses on Loans	$	21,218		$	23,882		-11.2	%	$	22,313
	Allowance for Credit Losses on Loans / Loans		2.17	%		2.11	%				2.23	%
	Nonperforming Loans/Total Loans		0.10	%		0.16	%				0.09	%

10. Capital.
		(in thousands, except per-share amounts)
								%
		9/30/22			9/30/21			Change		6/30/22
	Shareholders' Equity	$	538,988		$	837,953		-35.7	%	$	617,126
	Total Assets		7,177,025			7,403,573		-3.1	%		7,222,405
	Shareholders' Equity/Total Assets		7.51	%		11.32	%				8.54	%
	Shareholders' Equity/Total Loans		55.05	%		73.99	%				61.73	%
	Tangible Common Equity Ratio		5.91	%		9.83	%				6.97	%
	Common Shares Outstanding		26,911			26,866		0.2	%		26,896
	Common Equity Per Share	$	20.03		$	31.19		-35.8	%	$	22.94
	Market Value Per Common Share		52.29			56.26		-7.1	%		55.66
		(shares in thousands)
								%
		Q3'2022			Q3'2021			Change		Q2'2022
	Share Repurchase Programs:
	Total Shares Repurchased		-			-		n/m			-
	Average Repurchase Price	$	-		$	-		n/m		$	-
	Net Shares Issued		(15	)		(1	)	n/m			(13	)
								%
		9/30'22YTD			9/30'21YTD			Change
	Total Shares Repurchased		3			4		n/m
	Average Repurchase Price	$	58.66		$	61.09		n/m
	Net Shares Issued		(45	)		(59	)	n/m

11. Period-End Balance Sheets.
		(unaudited, dollars in thousands)
								%
		9/30/22			9/30/21			Change		6/30/22
	Assets:
	Cash and Due from Banks	$	413,665		$	1,011,048		-59.1	%	$	753,293
	Debt Securities Available For Sale:
	Corporate Securities		2,138,508			2,668,389		-19.9	%		2,296,853
	Collateralized Loan Obligations		1,587,622			1,379,533		15.1	%		1,601,333
	Agency Mortgage Backed Securities		296,689			458,053		-35.2	%		331,425
	Securities of U.S. Government sponsored entities		272,525			-		n/m			290,725
	Obligations of States and Political Subdivisions		80,987			96,603		-16.2	%		86,676
	Other Debt Securities Available For Sale		-			128		n/m			102
	Total Debt Securities Available For Sale		4,376,331			4,602,706		-4.9	%		4,607,114
	Debt Securities Held To Maturity:
	Agency Mortgage Backed Securities		112,371			166,955		-32.7	%		121,810
	Corporate Securities		720,154			-		n/m			181,316
	Obligations of States and Political Subdivisions (2)		103,742			189,151		-45.2	%		139,228
	Total Debt Securities Held To Maturity (2)		936,267			356,106		162.9	%		442,354
	Loans		979,033			1,132,472		-13.5	%		999,768
	Allowance For Credit Losses on Loans		(21,218	)		(23,882	)	-11.2	%		(22,313	)
	Total Loans, net		957,815			1,108,590		-13.6	%		977,455
	Premises and Equipment, net		29,756			31,603		-5.8	%		30,309
	Identifiable Intangibles, net		644			900		-28.4	%		707
	Goodwill		121,673			121,673		0.0	%		121,673
	Other Assets		340,874			170,947		99.4	%		289,500
	Total Assets	$	7,177,025		$	7,403,573		-3.1	%	$	7,222,405
	Liabilities and Shareholders' Equity:
	Deposits:
	Noninterest-Bearing	$	3,069,907		$	2,988,329		2.7	%	$	2,987,725
	Interest-Bearing Transaction		1,338,855			1,257,460		6.5	%		1,303,700
	Savings		1,949,711			1,894,290		2.9	%		1,983,713
	Time		136,783			148,882		-8.1	%		140,453
	Total Deposits		6,495,256			6,288,961		3.3	%		6,415,591
	Short-Term Borrowed Funds		76,886			119,102		-35.4	%		118,167
	Other Liabilities		65,895			157,557		-58.2	%		71,521
	Total Liabilities		6,638,037			6,565,620		1.1	%		6,605,279
	Shareholders' Equity:
	Common Equity:
	Paid-In Capital		474,732			470,711		0.9	%		473,555
	Accumulated Other Comprehensive (Loss) Income		(290,797	)		71,284		n/m			(188,025	)
	Retained Earnings		355,053			295,958		20.0	%		331,596
	Total Shareholders' Equity		538,988			837,953		-35.7	%		617,126
	Total Liabilities and Shareholders' Equity	$	7,177,025		$	7,403,573		-3.1	%	$	7,222,405

12. Income Statements.
		(unaudited, in thousands except per-share amounts)
						%
		Q3'2022		Q3'2021		Change		Q2'2022
	Interest & Fee Income:
	Loans	$	12,208	$	14,789	-17.5	%	$	12,331
	Equity Securities		127		109	16.5	%		129
	Debt Securities Available For Sale		39,100		26,452	47.8	%		31,764
	Debt Securities Held To Maturity		6,625		2,091	216.9	%		1,771
	Interest-Bearing Cash		2,742		369	643.1	%		2,002
	Total Interest & Fee Income		60,802		43,810	38.8	%		47,997
	Interest Expense:
	Transaction Deposits		94		101	-6.9	%		91
	Savings Deposits		290		272	6.6	%		288
	Time Deposits		86		100	-14.0	%		82
	Short-Term Borrowed Funds		17		19	-10.5	%		22
	Total Interest Expense		487		492	-1.0	%		483
	Net Interest Income		60,315		43,318	39.2	%		47,514
	Provision for Credit Losses		-		-	n/m			-
	Noninterest Income:
	Service Charges		3,737		3,578	4.4	%		3,687
	Merchant Processing Services		2,925		3,159	-7.4	%		3,374
	Debit Card Fees		1,594		1,740	-8.4	%		1,709
	Trust Fees		810		839	-3.5	%		809
	ATM Processing Fees		594		573	3.7	%		469
	Other Service Fees		463		475	-2.6	%		480
	Financial Services Commissions		79		95	-16.8	%		118
	Life Insurance Gains		923		-	n/m			-
	Other Noninterest Income		693		823	-15.8	%		618
	Total Noninterest Income		11,818		11,282	4.8	%		11,264
	Noninterest Expense:
	Salaries and Benefits		11,311		11,813	-4.2	%		11,412
	Occupancy and Equipment		5,064		4,759	6.4	%		4,856
	Outsourced Data Processing		2,434		2,429	0.2	%		2,423
	Limited Partnership Operating Losses		1,431		620	130.8	%		1,431
	Professional Fees		582		724	-19.6	%		736
	Courier Service		671		534	25.7	%		661
	Other Noninterest Expense		3,274		3,818	-14.2	%		3,110
	Total Noninterest Expense		24,767		24,697	0.3	%		24,629
	Income Before Income Taxes		47,366		29,903	58.4	%		34,149
	Income Tax Provision		12,606		7,840	60.8	%		8,835
	Net Income	$	34,760	$	22,063	57.5	%	$	25,314
	Average Common Shares Outstanding		26,906		26,866	0.1	%		26,889
	Diluted Common Shares Outstanding		26,916		26,875	0.2	%		26,901
	Per Common Share Data:
	Basic Earnings	$	1.29	$	0.82	57.3	%	$	0.94
	Diluted Earnings		1.29		0.82	57.3	%		0.94
	Dividends Paid		0.42		0.41	2.4	%		0.42
						%
		9/30'22YTD		9/30'21YTD		Change
	Interest & Fee Income:
	Loans	$	37,481	$	44,434	-15.6	%
	Equity Securities		384		329	16.7	%
	Debt Securities Available For Sale		99,430		77,822	27.8	%
	Debt Securities Held To Maturity		10,040		7,051	42.4	%
	Interest-Bearing Cash		5,223		766	581.9	%
	Total Interest & Fee Income		152,558		130,402	17.0	%
	Interest Expense:
	Transaction Deposits		273		283	-3.5	%
	Savings Deposits		861		785	9.7	%
	Time Deposits		249		330	-24.5	%
	Short-Term Borrowed Funds		67		53	26.4	%
	Total Interest Expense		1,450		1,451	-0.1	%
	Net Interest Income		151,108		128,951	17.2	%
	Provision for Credit Losses		-		-	n/m
	Noninterest Income:
	Service Charges		11,006		10,117	8.8	%
	Merchant Processing Services		8,922		8,998	-0.8	%
	Debit Card Fees (1)		6,175		5,132	20.3	%
	Trust Fees		2,462		2,467	-0.2	%
	ATM Processing Fees		1,514		1,792	-15.5	%
	Other Service Fees		1,392		1,435	-3.0	%
	Financial Services Commissions		314		260	20.8	%
	Life Insurance Gains		923		-	n/m
	Securities Gains		-		34	n/m
	Other Operating		1,950		2,268	-14.0	%
	Total Noninterest Income		34,658		32,503	6.6	%
	Noninterest Expense:
	Salaries and Benefits		34,643		36,575	-5.3	%
	Occupancy and Equipment		14,666		14,447	1.5	%
	Outsourced Data Processing		7,294		7,244	0.7	%
	Limited Partnership Operating Losses		4,293		1,820	135.9	%
	Professional Fees		2,054		2,496	-17.7	%
	Courier Service		1,914		1,605	19.3	%
	Other Operating		9,407		9,707	-3.1	%
	Total Noninterest Expense		74,271		73,894	0.5	%
	Income Before Income Taxes		111,495		87,560	27.3	%
	Income Tax Provision		28,805		22,771	26.5	%
	Net Income	$	82,690	$	64,789	27.6	%
	Average Common Shares Outstanding		26,889		26,851	0.1	%
	Diluted Common Shares Outstanding		26,901		26,868	0.1	%
	Per Common Share Data:
	Basic Earnings	$	3.08	$	2.41	27.8	%
	Diluted Earnings		3.07		2.41	27.4	%
	Dividends Paid		1.26		1.23	2.4	%

Footnotes and Abbreviations:

(1) The Company received a $1.2 million reconciling payment from a payments network in the first quarter 2022.

(2) Debt Securities Held To Maturity and Obligations of States and Political Subdivisions are net of related reserve for expected credit losses of $7 thousand at September 30, 2022, June 30, 2022 and September 30, 2021.

(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 relatively large 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

Certain amounts in prior periods have been reclassified to conform to the current presentation.