Note 15 - Retirement Benefit Plans

12 Months Ended

Dec. 31, 2012

Pension and Other Postretirement Benefits Disclosure [Text Block]

Note 15: Retirement Benefit Plans

The Company sponsors a qualified defined contribution Deferred Profit-Sharing Plan covering substantially all of its salaried employees with one or more years of service. The costs charged to noninterest expense related to discretionary Company contributions to the Deferred Profit-Sharing Plan were $1,200 thousand in 2012, $1,200 thousand in 2011 and $1,740 thousand in 2010.

The Company also sponsors a qualified defined contribution Tax Deferred Savings/Retirement Plan (ESOP) covering salaried employees who become eligible to participate upon completion of a 90-day introductory period. The Tax Deferred Savings/ Retirement Plan (ESOP) allows employees to defer, on a pretax or after-tax basis, a portion of their salaries as contributions to this Plan. Participants may invest in several funds, including one fund that invests primarily in Westamerica Bancorporation common stock. The Company funds contributions to match participating employees’ contributions, subject to certain limits. The matching contributions charged to compensation expense were $1,255 thousand in 2012, $1,283 thousand in 2011 and $1,377 thousand in 2010.

The Company offers a continuation of group insurance coverage to eligible employees electing early retirement, for the period from the date of retirement until age 65. For eligible employees the Company pays a portion of these early retirees’ group insurance premiums. The Company also reimburses a portion of Medicare Part B premiums for all qualifying retirees over age 65 and, if eligible, their spouses. Eligibility for post-retirement medical benefits is based on age and years of service, and restricted to employees hired prior to February 1, 2006 who elect early retirement prior to January 1, 2018. The Company uses an actuarial-based accrual method of accounting for post-retirement benefits. The Company used a December 31 measurement date for determining post-retirement medical benefit calculations.

The following tables set forth the net periodic post-retirement benefit cost and the change in the benefit obligation for the years ended December 31 and the funded status of the post-retirement benefit plan as of December 31:

Net Periodic Benefit Cost

	At December 31,
	2012			2011			2010
	(In thousands)
Service cost	$	(340	)	$	(35	)	$	(371	)
Interest cost		143			175			193
Amortization of unrecognized transition obligation		61			61			61
Net periodic (benefit) cost		(136	)		201			(117	)

Other Changes in Benefit Obligations Recognized in Other Comprehensive Income

Amortization of unrecognized transition obligation, net of tax		(36	)		(36	)		(36	)
Total recognized in net periodic (benefit) cost and accumulated other comprehensive income	$	(172	)	$	165		$	(153	)

The remaining transition obligation cost for this post-retirement benefit plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year is $61 thousand.

Obligation and Funded Status

	For the years ended December 31,
	2012			2011			2010
Change in benefit obligation	(In thousands)
Benefit obligation at beginning of year	$	3,117		$	3,178		$	3,519
Service cost		(340	)		(35	)		(371	)
Interest cost		143			175			193
Benefits paid		(165	)		(201	)		(163	)
Benefit obligation at end of year	$	2,755		$	3,117		$	3,178
Accumulated post-retirement benefit obligation attributable to:
Retirees	$	1,654		$	2,363		$	1,990
Fully eligible participants		856			537			951
Other		245			217			237
Total	$	2,755		$	3,117		$	3,178
Fair value of plan assets	$	—		$	—		$	—
Accumulated post-retirement benefit obligation in excess of plan assets	$	2,755		$	3,117		$	3,178

Additional Information

Assumptions

	At December 31,
	2012			2011			2010
Weighted-average assumptions used to determine benefit obligations as of December 31
Discount rate		4.00	%		4.60	%		5.50	%
Weighted-average assumptions used to determine net periodic benefit cost as of December 31
Discount rate		4.60	%		5.50	%		5.50	%

The above discount rate is based on the Corporate Aa 25-year rate, the term of which approximates the term of the benefit obligations. The Company reserves the right to terminate or alter post-employment health benefits. Post-retirement medical benefits are currently fixed amounts without provision for future increases; as a result, the assumed annual average rate of inflation used to measure the expected cost of benefits covered by this program is zero percent for 2013 and beyond.

Assumed benefit inflation rates are not applicable for this program.

	Estimated future benefit payments (In thousands)
2013	$	170
2014		171
2015		175
2016		180
2017		187
Years 2018-2022		882