Long/short equity, medium-term horizon, value, growth

Westamerica Bancorporation: A Good Solid Bank, But Perhaps Overvalued

Westamerica Bancorporation (NASDAQ:WABC) is a well capitalized, small-cap bank operating in California. It offers a range of banking services to both, retail and corporate customers in Northern and Central California. Westamerica prides itself on its focus on conservative lending practices, rigorous cost controls and its financial health and safety. Following the financial crisis, Westamerica proved its strength, when it continued to deliver strong profitability, and made two major acquisitions which significantly increased the size and scale of the bank.

Westamerica's financial strength enabled the bank to take advantage of the opportunities to efficiently acquire assets from its troubled competitors. In February 2009, the bank acquired the assets of County Bank with a loss-sharing agreement with the Federal Deposit...

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