Westamerica Bank

Adopted August 27, 2009


This Policy fulfills the requirements under the American Recovery and Reinvestment Act of 2009 (ARRA) enacted February 17, 2009.  ARRA requires each recipient of funds under the Capital Purchase Program (CPP) of the Troubled Assets Relief Program (TARP) to have in place a company-wide policy regarding excessive or luxury expenditures, as identified by the Secretary of the Department of the U.S. Treasury.

Westamerica Bancorporation (WABC) and its subsidiary, Westamerica Bank, prohibit excessive or luxury expenditures on entertainment and events, office or facility renovations, aviation or other transportation services or other activities or events that are not reasonable expenditures for conferences, staff development or other similar measures conducted in the normal course of business operations.

Renovations
Renovations of facilities and office space should be relative to the approved project and current strategic plan of WABC.  An exception to this is allowed if management must deal with an emergency situation, such as an act of nature, and the expenditure is necessary to make the facility operational for customer use.  At no time should renovations be done that would have the appearance of being extraordinary or excessive from a shareholder perspective.  CEO approval is required for all renovations over $25 thousand.

Entertainment
Entertainment is defined as an activity that an employee or executive would use corporate funds for business development purposes related to a current or prospective customer or to further enhance WABC’s marketing efforts.  All expenses incurred to the Bank are for specific company purposes and used to drive business to the Bank.  Events and parties focused on customers for the purpose of attracting or retaining their business would not fall under this Policy.

Conferences
We encourage WABC staff to attend conferences that are appropriate education opportunities.  These conferences must be related to the financial services industry and have a direct correlation to their job.  Typically these conferences are sponsored by vendors, banking associates or other industry-related entities.  

Board/Management Retreats
Retreats shall only be used for educational or business planning purposes and should be kept in consideration and looked at in the same view and discretion as all other expenses.  Board education is a vital part of maintaining and keeping a dynamic director base, and this Policy should not limit a retreat that is focused on strategic planning or education.

Aviation
WABC will reimburse employees and directors for reasonable transportation expenses incurred for travel to and from pre-approved conferences, planning retreats or other business purposes.  Reasonable airfare is considered coach travel class.  WABC will not reimburse for first or business class travel.  Private air services are not allowed under any circumstances.  WABC will not reimburse employees or directors for aviation or other travel-related expenses associated with any spouse or guest that may accompany them on a business trip.  This would include travel, food and lodging.

Administration
The CFO is responsible for the day-to-day administration of this Policy and the CEO is accountable for overall adherence to this Policy and must approve any exceptions.  The Employee Benefits/Compensation Committee is also authorized to approve any exceptions. The CEO and CFO will annually review this policy and certify compliance.  Strict adherence to this Policy is mandated for all WABC employees and directors.  Violations of this Policy shall be promptly reported to the Employee Benefits/Compensation Committee.

This Policy and any amendments hereto, shall be posted on the WABC website and provided to the U.S. Department of the Treasury, the Federal Reserve Bank of San Francisco, the FDIC and the Department of Financial Institutions.
This Policy will be reviewed and approved by the Board of Directors annually.