WABCMEDIUM SIGNALFINANCIAL10-K

WABC reported declining profitability with net income falling 16.2% and net interest income dropping 13.8% year-over-year.

The company's core banking operations faced pressure as net interest income declined meaningfully, suggesting margin compression or volume challenges in the lending business. While the reduced provision for credit losses indicates improving credit quality, this positive factor was insufficient to offset the underlying earnings decline.

Comparing 2026-02-27 vs 2025-02-28View on EDGAR →
FINANCIAL ANALYSIS

WABC's financial performance weakened across key metrics, with net income declining to $116.2 million and net interest income falling to $231.0 million. Operating cash flow similarly decreased to $121.9 million, reflecting the earnings pressure. The company did benefit from a lower provision for credit losses at $1.9 million, indicating improved asset quality, while capital expenditures increased modestly to $2.2 million.

FINANCIAL STATEMENT CHANGES
Provision for Credit Losses
P&L
+40.6%
-$3.2M→-$1.9M

Credit loss provisions surged 40.6% — management flagging significant deterioration in loan quality ahead.

Capital Expenditure
Cash Flow
+28.8%
$1.7M→$2.2M

Capex increased 28.8% — ongoing investment in capacity or infrastructure for future growth.

Net Income
P&L
-16.2%
$138.6M→$116.2M

Net income declined 16.2% — review whether driven by operations, interest costs, or non-recurring items.

Operating Cash Flow
Cash Flow
-13.9%
$141.6M→$121.9M

Operating cash flow softened — monitor whether temporary working capital timing or structural deterioration.

Net Interest Income
P&L
-13.8%
$268.0M→$231.0M

Net interest income declined 13.8% — margin compression from rate changes or funding cost increases.

LANGUAGE CHANGES
NEW — 2026-02-27
PRIOR — 2025-02-28
ADDED
At December 31, 2025, the Company had consolidated assets of approximately $6.0 billion, deposits of approximately $4.8 billion and shareholders equity of approximately $934 million.
-4- The Economic Growth, Regulatory Relief, and Consumer Protection Act (the Relief Act ), which was enacted in 2018, exemption banks with less than $10 billion in total consolidated assets and total trading assets and trading liabilities of less than five percent of total consolidated assets from Section 619 of the Dodd-Frank Act, known as the Volcker Rule , which prohibits proprietary trading and the ownership or sponsorship of private equity or hedge funds that are referred to as covered funds.
The CGCL provides that a corporation may make a distribution to its shareholders, such as a cash dividend or share repurchase, to the extent that (i) the corporation s retained earnings equal or exceed the amount of the proposed distribution plus unpaid accrued dividends (if any) on securities with a dividend preference, or (ii) immediately after the dividend, the corporation s total assets equal or exceed total liabilities plus unpaid accrued dividends (if any) on securities with a dividend preference.
The Company s ability to pay dividends and repurchase its shares depends in part on the Bank s ability to pay cash dividends to the Company.
Consumer Laws and Regulations We are subject to consumer laws and regulations intended to protect consumers in transactions with depository institutions, as well as other laws or regulations affecting customers of financial institutions generally.
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REMOVED
At December 31, 2024, the Company had consolidated assets of approximately $6.1 billion, deposits of approximately $5.0 billion and shareholders equity of approximately $890 million.
-5- On July 2, 2013, the Federal Reserve Board approved a final rule that implements changes to the regulatory capital framework for all banking organizations over a transitional period 2015 through 2018.
The CGCL provides that a corporation may make a distribution to its shareholders if (i) the corporation s retained earnings equal or exceed the amount of the proposed distribution plus unpaid accrued dividends (if any) on securities with a dividend preference, or (ii) immediately after the dividend, the corporation s total assets equal or exceed total liabilities plus unpaid accrued dividends (if any) on securities with a dividend preference.
The Company s ability to pay dividends depends in part on the Bank s ability to pay cash dividends to the Company.
Economic Growth, Regulatory Relief and Consumer Protection Act On May 24, 2018, President Trump signed into law the first major financial services reform bill since the enactment of the Dodd-Frank Act.
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