What West Bancorporation Inc told the SEC could break it.

West Bancorporation flags a concentration of large deposits from certain clients, including those with balances above current FDIC insurance limits; because uninsured depositors are more likely to move funds quickly in stress, this deposit concentration presents a liquidity and funding-cost risk if one or more large clients withdraw or shift their balances to other institutions.

“the concentration of large deposits from certain clients, including those who have balances above current Federal Deposit Insurance Corporation (FDIC) insurance limits”

West Bancorporation's sole business is West Bank, a community bank whose offices are concentrated in central Iowa — its main office in West Des Moines, five additional offices in the Des Moines metro, one in Coralville — plus four offices in Minnesota (Rochester, Owatonna, Mankato, St. Cloud); this geographic concentration means a downturn in the Des Moines/Iowa or southern-Minnesota economies, real-estate markets or local employment would disproportionately affect its loan quality, deposits and earnings.

“West Bank is a state chartered bank and has its main office in West Des Moines, Iowa, with five additional offices located in the Des Moines, Iowa, metropolitan area, one office located in Coralville, Iowa, and four offices located in Minnesota, in the cities of Rochester, Owatonna, Mankato and St. Cloud.”

West Bancorporation's operations depend heavily on third-party information-technology and telecommunications systems — including outsourced online banking, mobile banking and accounting systems — and the termination of a third-party software license or service agreement, or the failure/interruption of those interfaced third-party systems (including service denials when demand exceeds capacity), could interrupt its ability to process loans, gather deposits and serve customers.

“Because our information technology and telecommunications systems interface with and depend on third-party systems, we could experience service denials if demand for such services exceeds capacity or such third-party systems fail or experience interruptions.”

As a bank holding company, West Bancorporation is subject to comprehensive federal and state banking regulation: banking organizations that fail to maintain the 2.5% capital conservation buffer above minimum capital requirements face constraints on dividends, stock repurchases and discretionary executive bonuses (absent prior regulatory approval), the FDIC and Iowa Division of Banking can prohibit dividends deemed unsafe or unsound, and it must comply with Bank Secrecy Act/anti-money-laundering and sanctions regimes — so regulatory capital, supervisory or AML developments could constrain its capital returns and raise compliance costs.

“of 2.5% above the regulatory minimum capital requirements will face constraints on the payment of dividends, stock repurchases and discretionary bonus payments to executive officers based on the amount of the shortfall, unless prior regulatory approval is obtained.”