Westamerica Bancorp. (WABC) in San Rafael, Calif., reported lower quarterly earnings as low interest rates and competition took a bite out of its bottom line.

The $4.9 billion-asset company's earnings fell 12% from a year earlier, to $19.1 million. Earnings per share of 70 cents were roughly in line with the average analysts' estimate, according to Bloomberg.

Westamerica's net interest income fell 13.3% from a year earlier, to $46.2 million. Its net interest margin compressed 75 basis points from the fourth quarter of 2011, to 4.49%. The loan portfolio shrank 16.7% from a year earlier, to $2.1 billion, because of a decline in loan demand from businesses and consumers.

Noninterest income fell 4.5% from a year earlier, to $14.1 million. Noninterest expense decreased 7.9% from a year earlier, to $28.2 million. The company's efficiency ratio was 46.7% at the end of the fourth quarter, compared to 44.9% at the end of 2011.

The loan-loss provision was flat from a year earlier, at $2.8 million.

"Westamerica continues to deliver relatively high levels of profitability in a difficult operating environment," David Payne, the company's chief executive, said in a press release Thursday. "We are focused on controlling costs while banking industry revenues are pressured by low interest rates and aggressive competition."

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