Westamerica Bank

July 18 , 2006

For Immediate Release


San Rafael, CA: Westamerica Bancorporation (NASDAQ: WABC), parent company of Westamerica Bank, today reported quarterly net income for the second quarter of 2006 of $24.5 million, or $0.77 diluted earnings per share, compared to net income of $27.7 million, or $0.83 diluted earnings per share for the second quarter of 2005. Second quarter 2005 results include a property sale gain, which increased diluted earnings per share $0.03. For the second quarter of 2006, return on assets was 1.99 percent and return on equity was 23.1 percent.

"In the second quarter 2006, our annualized net loan losses were 0.04 percent, our noninterest revenues were 21.4 percent of total revenues, and our expenses were 40 percent of total revenue. As expected, rising short-term interest rates caused our funding costs to rise, reducing our net interest margin. However, we remain focused on accumulating non-interest bearing deposits and money market checking balances to maintain a low cost of funds. Our second quarter 2006 cost of funds was 1.44 percent, supporting a relatively high 4.58 percent net interest margin, " said Chairman, President and CEO David Payne. "Our 23 percent return on equity remains top-tier in the banking industry," Payne added.

Net interest income on a taxable equivalent basis was $51.5 million for the second quarter of 2006, compared to $57.0 million reported for the second quarter of 2005. The reduced net interest income is attributable to a lower net interest margin and lower average earning assets. Short-term interest rates have risen faster than intermediate and longer term interest rates, causing funding costs to rise at a faster pace than earning asset yields. The second quarter 2006 net interest margin on a taxable equivalent basis was 4.58 percent, compared to 4.73 percent for the prior quarter and 4.84 percent for the second quarter of 2005.

The provision for loan losses was $150 thousand for the second quarter of 2006 unchanged from the prior quarter and down from $300 thousand for the second quarter of 2005. Net charge-offs for the second quarter of 2006 totaled $234 thousand, or 0.04 percent (annualized) of average loans compared to 0.04 percent (annualized) of average loans for both the prior quarter and second quarter of 2005. Non-performing loans and repossessed loan collateral at June 30, 2006 totaled $6.3 million, unchanged from $6.3 million at March 31, 2006.

Noninterest income for the second quarter of 2006 was $14.1 million, compared to $13.6 million for the previous quarter and $15.5 million for the second quarter of 2005 which included a $1.3 million property sale gain.

Noninterest expense for the second quarter of 2006 totaled $26.3 million, increased from $25.5 million for the prior quarter, but down from $27.1 million for the second quarter of 2005. The increase in expenses from the prior quarter was primarily due to higher personnel costs and professional fees. Comparing the second quarter of 2006 to the second quarter of 2005, the decrease in noninterest expense was primarily due to lower personnel costs offset in part by higher professional fees. The second quarter 2006 efficiency ratio (expenses divided by revenues) was 40.2 percent, compared to 37.7 percent for the prior quarter and 37.4 percent for the second quarter of 2005.

Shareholders' equity at June 30, 2006 was $422 million, slightly reduced from $429 million at March 31, 2006. The Company's total regulatory capital ratio increased to 10.9 percent at June 30, 2006 from 10.7 percent at March 31, 2006; both measurements exceed the "well-capitalized" level of 10 percent under regulatory requirements.

Westamerica Bancorporation, through its wholly owned subsidiary Westamerica Bank, operates 87 branches and two trust offices throughout 21 Northern and Central California counties. At June 30, 2006, the Company's total assets and total loans outstanding were $4.9 billion and $2.6 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 annual and quarterly reports filed with the Securities and Exchange Commission, including the Company's Form 10-Q for the quarter ended March 31, 2006 and Form 10-K for the year ended December 31, 2005, 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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