Foiled in efforts to buy four community banks this year, the chairman of Westamerica Bancorp. has promised to jump back in the acquisition game in 1999.
David L. Payne, speaking at an investor conference in Washington, D.C., last Thursday, said he has been "distressed" since January over his company's inability to make acquisitions.
An active acquirer since 1992, Westamerica of San Rafael, Calif., was outbid on four deals that fetched what Mr. Payne labeled "exorbitant prices." This forced Westamerica to begin buying back its stock in July to leverage excess capital.
But Mr. Payne told investors that Westamerica - the state's ninth- largest banking company, with $3.1 billion of deposits and 89 branches in 22 counties - will not sit on the sidelines much longer.
"We think there will be some acquisition opportunities next year with banks that cannot make the grade with year-2000," said Mr. Payne. He added that Westamerica would stick to its primary market area in northern and central California, steering clear of Southern California.
The conference, hosted by Friedman, Billings, Ramsey & Co. of Arlington, Va., was the first of several East Coast stops Mr. Payne has planned this month to tout the company to investors.
In addition to commercial bank deals, Mr. Payne said, Westamerica would consider buying a trust business to beef up its $500 million-asset trust operation.
Joseph R. Morford, an analyst at Van Kasper & Co. in San Francisco, said 1998 has been a sluggish year for Westamerica, whose revenue growth has slowed as lending markets grew more competitive.
But he agreed that acquisition opportunities may arise for the company with banks that are not year-2000 compliant.
"There will be some banks forced to sell who will not be in the best bargaining position," Mr. Morford said. "This could offer Westamerica some good fill-in opportunities."