Westamerica Bank

july 13, 2010

For Immediate Release

San Rafael, CA: Westamerica Bancorporation (NASDAQ: WABC), parent company of Westamerica Bank, today reported second quarter 2010 net income applicable to common equity of $23.6 million, or $0.80 diluted earnings per share (“EPS”), compared to $23.6 million, or $0.80 EPS in the prior quarter and $22.1 million, or $0.75 EPS in the second quarter 2009. Second quarter 2009 results include the operations of the former County Bank, which Westamerica acquired from the Federal Deposit Insurance Corporation (FDIC) on February 6, 2009. Second quarter 2010 net income applicable to common equity represents an 18.2 percent annualized return on average common equity.

“Westamerica’s net interest margin rose to 5.62 percent in the second quarter 2010 from 5.60 percent in the prior quarter. We continue to apply our long-held practice of focusing on checking and savings deposits which now represent 78 percent of our deposit base. The annualized cost of funding our loan and investment portfolios was only 0.31 percent in the second quarter 2010,” said Chairman, President and CEO David Payne. “Our credit quality remains stable with second quarter net loan losses totaling 0.64 percent (annualized) of our non-FDIC indemnifed loan portfolio, and our loan loss reserve represents 1.87 percent of non-indeminfied loans at quarter-end. Common shareholders’ equity grew to $528 million at June 30, 2010 resulting in a total regulatory capital ratio of 15.7,” Payne added.

Net interest income on a fully taxable equivalent basis (FTE) was $56.6 million for the second quarter 2010, compared to $57.0 million (FTE) for the prior quarter and $62.3 million (FTE) for the second quarter 2009. The second quarter 2010 annualized net interest margin was 5.62 percent (FTE), compared to 5.60 percent (FTE) for the prior quarter and 5.34 percent (FTE) for the second quarter 2009. The decline in net interest income is attributable to lower levels of interest-earning assets. Weak economic conditions and deleveraging by businesses and individuals have impacted loan volumes.

The provision for loan losses was $2.8 million for the second quarter 2010, compared to $2.8 million and $2.6 million for the first quarter 2010 and second quarter 2009, respectively. Non-covered non-performing loans at June 30, 2010 totaled $21 million, unchanged from $21 million at March 31, 2010.

Noninterest income for the second quarter 2010 was $15.8 million, compared to $15.5 million in the first quarter 2010.

Noninterest expense for the second quarter of 2010 totaled $32.1 million, unchanged from the prior quarter. Personnel cost declines were offset by increases in professional fees and expenses related to repossessed loan collateral in the second quarter 2010 compared to the prior quarter’s expenses.

Shareholders' equity at June 30, 2010 was $528 million, increased from $519 million at March 31, 2010. Westamerica paid a regular quarterly dividend of $0.36 per common share in May 2010, totaling $10.6 million. At June 30, 2010, Westamerica Bancorporation’s total regulatory capital ratio was 15.7 percent and Westamerica Bank’s total regulatory capital ratio was 15.4 percent; both measurements exceed the "well-capitalized" level of ten percent under regulatory requirements.

Westamerica Bancorporation, through its wholly owned subsidiary Westamerica Bank, operates commercial banking offices throughout Northern and Central California. At June 30, 2010, the Company's total assets and total loans outstanding were $4.7 billion and $2.9 billion, respectively.


Quarterly Financial Highlights

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, 2009 filed on Form 10-K and quarterly report for the quarter ended March 31, 2010 filed on Form 10-Q, describe some of these factors, including certain credit, market, operational, liquidity and interest rate 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, legislation including 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.

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For additional information contact:

Westamerica Bancorporation
Robert A. Thorson, Senior Vice President and Chief Financial Officer, (707) 863-6840
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