2009 Shareholders’ Meeting
April 16, 2009
1
2008 Year in Review
2
2008 Overview
Year of Conflicts
Many positive aspects to year
Doug will highlight 2008 financial picture
Brad will review activities at West Bank in 2008
Doug will discuss WB Capital Management
Extraordinary issues
Iowa’s largest homebuilder fails
Wholesale propane customer is defrauded
Investment impairment caused by failures in financial services
companies
American Equity Investment Life Holding makes an offer to acquire
company
Sold $36,000,000 of preferred stock to U.S. Treasury in Capital
Purchase Program
3
2008 Financial Review
4
West Bancorporation, Inc.
+606.4%
$2,350
$16,600
Provision for
loan losses
+23.4%
$121.6 mil
$150.1 mil
Stockholders'
equity
+26.8%
$911 mil
$1.155 bil
Total deposits
+15.9%
$1.340 bil
$1.553 bil
Total assets
-59.6%
$18,920
$7,636
Net income
% Change
2007
2008
5
West Bancorporation, Inc.
+6.4%
9.08%
9.66%
Equity: Assets
-17.9%
7.20%
5.91%
Tangible
common equity:
Tangible assets
-2.3%
44.23%
45.25%
Efficiency
+3.0%
3.28%
3.38%
NIM
-60.1%
16.21%
6.47%
ROE
-61.4%
1.45%
0.56%
ROA
% Change
2007
2008
6
West Bancorporation, Inc.
Non-Recurring Items
2008
$317,000
•Community Bank Unit Investment Trust
$1,800,000
•Lehman Brothers bond
$2,622,000
preferred security)
•ALESCO (a pooled trust
Securities impairments:
$3,300,000
•Customer impacted by fraud
$4,675,000
•Large home builder
Loan charge-offs:
7
WB Capital Management, Inc.
-6.6%
$8,137
$7,596
Revenue
+42.0%
3.00%
4.26%
WB Cap net
income as % of
consolidated net
income
-42.8%
$568
$325
Net income
-3.8%
$4.49 bil
$4.32 bil
Assets under
management
% Change
2007
2008
8
Loss on Lehman Brothers bond $458,000
WB Capital Management, Inc.
Non-Recurring Item
2008
9
2008 Bank Review
10
2008 West Bank Review
12% Loan Growth
(year over year)
11% Loan Growth
(average)
Late 3Q and 4Q loan
demand softened
Underwriting criteria
increased
27% Deposit Growth
(year over year)
6% Deposit Growth
(average)
Reward Me Checking
Small Commercial 3D
(Coffee Campaign)
CDARS
SmartyPig
11
Retail Banking
Remodeled Merle Hay
Branch
February 09 grand opening
New Waukee Branch
March 09 grand opening
Staffed retail, mortgage,
small business
New Personnel
Scott Jarvis, Head of Retail
Matt Klein, City Center
Matt Petersen, Waukee
Trisha Knepper, Urbandale
Training
Presentation Training
Sales Training & Coaching
Product Training
12
Trust
4% Revenue Growth
New Personnel
Carol Stone, former head of Trust Department
promoted to Chief Compliance Officer
Jim Benda, Senior Trust Officer, hired to lead
the department
13
Commercial Banking
New Personnel
Aldrich Cabildo, 1st Vice President
Steve Miller, 1st Vice President
Training
Sales and Coaching
Presentation Training
Product Training
Treasury Management
Expanded and improved existing product line
Positive Pay rollout 2009
14
Residential Mortgage
333% Increase in Gross Fees Earned in 2008
345% Increase in Gross Fees Earned 1Q09
New Personnel
Steve Federspiel, 2nd Vice President
Tim Bonert, 2nd Vice President
15
Credit Administration
Compliance
Lost Georgann Mefferd to Cancer
22 year employee
Financial Literacy, Hawthorne Hill
Ministries, Neighborhood Finance
Law Degree; Legal, credit and chief
compliance officer.
Promoted Carol Stone to Chief
Compliance Officer
Fmr Head of Trust Department
Extensive background in financial
compliance arena
Additions to staff to meet growing
regulatory challenges
2008 Compliance Exam
Asset Quality
Dave Milligan rejoined bank
Head of troubled loans
John Goranson
Head of Loan Audit
Additions to staff to meet growing
regulatory challenges
2008 Safety & Soundness Exam
CRM Introduced and Trained
Relationship Management Tool
Profitability
Sales tracking
Prospect tracking
Direct Marketing
Retention and Cross sell efforts
16
Bank Awards & Community Outreach
2009 Better Business Bureau
Integrity Award Recipient
2008 Community Champion
Award from the Greater Des
Moines Partnership
2009 United Way Leader in
Giving Award
Employee Community
Involvement
210 Employees contributed more than
10,000 community service hours
And hold 82 non profit board seats
Shred it Day (May 08)
Central and Eastern Iowa
3rd Annual Event scheduled for May 16,
2009
West Bancorporation
Foundation
$250,000 in grants awarded
17
2008 WB Capital Management
Review
18
2009 First Quarter Results
and Dividend Declaration
19
Preliminary 2009 First Quarter Results
Earnings will be released on April 30th
Good core earnings with significant
one-time gains and losses
20
Preliminary First Quarter Results
-37.5%
$5,600
$3,500
Provision for
loan losses
+26.8%
$119.3 mil
$151.3 mil
Stockholders'
equity
+35.1%
$884 mil
$1.194 bil
Total deposits
+20.9%
$1.333 bil
$1.612 bil
Total assets
+114.0%
$1,374
$2,941
Net income
% Change
2008
2009
21
Preliminary First Quarter Results
+4.6%
9.20%
9.62%
Equity: Assets
-18.5%
7.08%
5.77%
Tangible
common equity:
Tangible assets
-5.8%
47.45%
50.19%
Efficiency
-15.1%
3.38%
2.87%
NIM
+72.7%
4.54%
7.84%
ROE
+78.6%
0.42%
0.75%
ROA
% Change
2008
2009
22
Preliminary First Quarter Results
Non-Recurring Items
$1,453,000
Gains from the sale of investment securities
$840,000
Bank-owned life insurance death benefit
$35,000
•Community Bank Unit Investment Trust
$500,000
•Single-issue trust preferred security
$880,000
•Single-issue trust preferred security
Securities impairments:
23
2009 First Quarter Dividend
Declared a $0.01 per share dividend
Record date: April 27th
Payment date: May 13th
Objective is to increase tangible common
equity through retained earnings as
quickly as possible
24
2009 and Beyond
25
Business Plan through 2010
Loans
Adverse Assets
Resolution
Stricter underwriting
standards
Reduce out-of-market
lending
Improve compliance
process
Investments
Gradually eliminate all
corporate investments
Remain invested in
High-grade municipal
bonds,
Mortgage-backed
securities of government
agency
Direct government
agency debt
Focus on Asset Quality Improvement
26
Business Plan through 2010
Continue with steady but more
focused growth in market
share
Shift primary emphasis from
new customer development to
expanding existing customers’
relationships
Greater deposit growth than
loan growth
Remain a traditional community
bank, serving the needs of the
customer
Capital Requirements
Use of Capital Purchase
Program monies
Organic growth
Tangible common equity ratios
Repay CPP money as quickly as
possible
27
WB Capital Strategic Assessment
Under-performed our investment expectations
Reviewing all options
Change investment strategies
Market to different clients
Merge into trust department
Have not actively attempted to sell but will consider
meaningful unsolicited offers
Business Plan through 2010
28
Future of the Company
Continue as a traditional community bank
Stay on the offense
Enhance Customer Service
Introduce new products
Remain rate-competitive but price loans for risk
Commence strategic review of West Bank in May
Stay true to our core values
29
Question and Answer
30
2009 Shareholders’ Meeting
April 16, 2009
31
