Bank of the Ozarks Announces Record Second Quarter 2017 Earnings

LITTLE ROCK, Ark.--()--Bank of the Ozarks (the “Bank”) (NASDAQ: OZRK) today announced that net income for the second quarter of 2017 was a record $90.5 million, a 66.2% increase from $54.5 million for the second quarter of 2016. Diluted earnings per common share for the second quarter of 2017 were $0.73, a 21.7% increase from $0.60 for the second quarter of 2016.

For the six months ended June 30, 2017, net income totaled $179.7 million, a 69.3% increase from net income of $106.2 million for the first six months of 2016. Diluted earnings per common share for the first six months of 2017 were $1.46, a 25.9% increase from $1.16 for the first six months of 2016.

On June 26, 2017, the Bank merged with its former parent holding company, Bank of the Ozarks, Inc., with the Bank as the surviving corporation. All prior period financial data in this news release and accompanying schedules gives effect to this merger transaction.

The Bank’s annualized returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the second quarter of 2017 were 1.90%, 12.05% and 15.81%, respectively, compared to 1.91%, 14.35% and 15.92%, respectively, for the second quarter of 2016. The Bank’s annualized returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the first six months of 2017 were 1.92%, 12.41% and 16.45%, respectively, compared to 1.95%, 14.18% and 15.76%, respectively, for the first six months of 2016.

George Gleason, Chairman and Chief Executive Officer, stated, “We are very pleased to report our results for the second quarter of 2017, including quarterly records in net income, net interest income and service charge income, a 4.99% net interest margin, a 35.3% efficiency ratio and excellent asset quality and growth in non-purchased loans and leases.”

KEY BALANCE SHEET METRICS

Total loans and leases, including purchased loans, were $15.2 billion at June 30, 2017, a 56.1% increase from $9.7 billion at June 30, 2016. Non-purchased loans and leases were $11.0 billion at June 30, 2017, a 34.2% increase from $8.2 billion at June 30, 2016. Purchased loans were $4.16 billion at June 30, 2017, a 174.5% increase from $1.52 billion at June 30, 2016, but a 9.2% decrease from $4.58 billion at March 31, 2017. The unfunded balance of closed loans totaled $11.9 billion at June 30, 2017, a 61.7% increase from $7.3 billion at June 30, 2016.

Deposits were $16.2 billion at June 30, 2017, a 59.3% increase from $10.2 billion at June 30, 2016. Total assets were $20.1 billion at June 30, 2017, a 63.4% increase from $12.3 billion at June 30, 2016.

Common stockholders’ equity was $3.26 billion at June 30, 2017, a 109.4% increase from $1.56 billion at June 30, 2016. Tangible common stockholders’ equity was $2.54 billion at June 30, 2017, an 80.9% increase from $1.41 billion at June 30, 2016. Book value per common share was $25.43 at June 30, 2017, a 48.2% increase from $17.16 at June 30, 2016. Tangible book value per common share was $19.85 at June 30, 2017, a 28.0% increase from $15.51 at June 30, 2016. The calculations of the Bank’s tangible common stockholders’ equity and tangible book value per common share and the reconciliations to accounting principles generally accepted in the United States (“GAAP”) are included in the schedules accompanying this release.

The Bank’s ratio of common stockholders’ equity to total assets was 16.25% at June 30, 2017 compared to 12.68% at June 30, 2016. Its ratio of tangible common stockholders’ equity to total tangible assets was 13.15% at June 30, 2017 compared to 11.60% at June 30, 2016. The calculation of the Bank’s ratio of total tangible common stockholders’ equity to total tangible assets and the reconciliation to GAAP are included in the schedules accompanying this release.

NET INTEREST INCOME

Net interest income for the second quarter of 2017 was $202.1 million, a 69.8% increase from $119.0 million for the second quarter of 2016. Net interest margin, on a fully taxable equivalent (“FTE”) basis, was 4.99% for the second quarter of 2017, an increase of 17 basis points from 4.82% for the second quarter of 2016. Average earning assets were $16.5 billion for the second quarter of 2017, a 63.3% increase from $10.1 billion for the second quarter of 2016.

Net interest income for the first six months of 2017 was $392.9 million, a 69.7% increase from $231.6 million for the first six months of 2016. Net interest margin, on a FTE basis, was 4.93% for the first six months of 2017, an increase of six basis points from 4.87% for the first six months of 2016. Average earning assets were $16.3 billion for the first six months of 2017, a 68.0% increase from $9.7 billion for the first six months of 2016.

NON-INTEREST INCOME

Non-interest income for the second quarter of 2017 increased 40.1% to $31.8 million compared to $22.7 million for the second quarter of 2016. Non-interest income for the first six months of 2017 increased 43.0% to $60.9 million compared to $42.6 million for the first six months of 2016.

NON-INTEREST EXPENSE

Non-interest expense for the second quarter of 2017 increased 64.6% to $83.8 million compared to $50.9 million for the second quarter of 2016. Non-interest expense for the first six months of 2017 increased 64.4% to $162.1 million compared to $98.6 million for the first six months of 2016.

The Bank’s efficiency ratio (non-interest expense divided by the sum of net interest income FTE and non-interest income) for the second quarter of 2017 was 35.3% compared to 35.4% for the second quarter of 2016. The Bank’s efficiency ratio for the first six months of 2017 was 35.2% compared to 35.5% for the first six months of 2016.

ASSET QUALITY, CHARGE-OFFS AND ALLOWANCE

Excluding purchased loans, the Bank’s ratio of nonperforming loans and leases as a percent of total loans and leases was 0.11% at June 30, 2017 compared to 0.09% at June 30, 2016.

Excluding purchased loans, the Bank’s ratio of nonperforming assets as a percent of total assets was 0.23% at June 30, 2017 compared to 0.25% at June 30, 2016.

Excluding purchased loans, the Bank’s ratio of loans and leases past due 30 days or more, including past due non-accrual loans and leases, to total loans and leases was a record 0.15% at June 30, 2017 compared to 0.22% at June 30, 2016.

The Bank’s annualized net charge-off ratio for all loans and leases was 0.05% for the second quarter of 2017 compared to 0.06% for the second quarter of 2016. The Bank’s annualized net charge-off ratio for all loans and leases was 0.07% for the first six months of 2017 compared to 0.06% for the first six months of 2016.

The Bank’s allowance for loan and lease losses for its non-purchased loans and leases was $80.7 million, or 0.73% of total non-purchased loans and leases, at June 30, 2017 compared to $63.9 million, or 0.78% of total non-purchased loans and leases, at June 30, 2016. The Bank had $1.6 million of allowance for loan and lease losses for its purchased loans at June 30, 2017 compared to $1.2 million at June 30, 2016.

CONFERENCE CALL, TRANSCRIPT AND FILINGS

Management will conduct a conference call to discuss its quarterly results at 10:00 a.m. CT (11:00 a.m. ET) on July 12, 2017. Interested parties may listen to this call by dialing (844) 818-5110 (U.S. and Canada) or (210) 229-8841 (internationally) and asking for the Bank of the Ozarks conference call. A recorded playback of the call will be available for one week following the call at (855) 859-2056 (U.S. and Canada) or (404) 537-3406 (internationally). The passcode for this playback is 38548410. The call will be available live or in a recorded version on the Bank’s Investor Relations website at http://ir.bankozarks.com under “Company News.” The Bank will also provide a transcript of the conference call on its Investor Relations website, which will be available for 90 days.

The Bank files certain reports, proxy materials, and other information required by the Securities and Exchange Act of 1934 with the Federal Deposit Insurance Corporation (“FDIC”), copies of which are available electronically at the FDIC’s website at http://www.fdic.gov and are also available on the Bank’s Investor Relations website at http://ir.bankozarks.com under “Filings.”

NON-GAAP FINANCIAL MEASURES

This release contains certain non-GAAP financial measures. The Bank uses these non-GAAP financial measures, specifically return on average tangible common stockholders’ equity, tangible book value per common share, total tangible common stockholders’ equity and the ratio of total tangible common stockholders’ equity to total tangible assets, as important measures of the strength of its capital and its ability to generate earnings on its tangible capital invested by its shareholders. These measures typically adjust GAAP financial measures to exclude intangible assets. Management believes presentation of these non-GAAP financial measures provides useful supplemental information which contributes to a proper understanding of the financial results and capital levels of the Bank. These non-GAAP disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other banks. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the tables at the end of this release under the caption “Reconciliation of Non-GAAP Financial Measures.”

FORWARD-LOOKING STATEMENTS

This release and other communications by the Bank include certain “forward-looking statements” regarding the Bank’s plans, expectations, thoughts, beliefs, estimates, goals and outlook for the future that are intended to be covered by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on management’s expectations as well as certain assumptions and estimates made by, and information available to, management at the time. Those statements are not guarantees of future results or performance and are subject to certain known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those expressed in, or implied by, such forward-looking statements. These risks, uncertainties and other factors include, but are not limited to: potential delays or other problems implementing the Bank’s growth, expansion and acquisition strategies including delays in identifying sites, hiring or retaining qualified personnel, obtaining regulatory or other approvals, obtaining permits and designing, constructing and opening new offices; the ability to enter into and/or close additional acquisitions; problems with, or additional expenses relating to, integrating acquisitions; the inability to realize expected cost savings and/or synergies from acquisitions; problems with managing acquisitions; the effect of the announcements of any future acquisition on customer relationships and operating results; the availability and access to capital; possible downgrades in the Bank’s credit ratings or outlook which could increase the costs or availability of funding from capital markets; the ability to attract new or retain existing or acquired deposits or to retain or grow loans and leases, including growth from unfunded closed loans; the ability to generate future revenue growth or to control future growth in non-interest expense; interest rate fluctuations, including changes in the yield curve between short-term and long-term interest rates; competitive factors and pricing pressures, including their effect on the Bank’s net interest margin; general economic, unemployment, credit market and real estate market conditions, and the effect of such conditions on the creditworthiness of borrowers and lessees, collateral values, the value of investment securities and asset recovery values; changes in legal and regulatory requirements; recently enacted and potential legislation and regulatory actions and the costs and expenses to comply with new legislation and regulatory actions; changes in U.S. government monetary and fiscal policy; the ability to keep pace with technological changes, including changes regarding maintaining cybersecurity; an increase in the incidence or severity of fraud, illegal payments, security breaches or other illegal acts impacting the Bank or its customers; adoption of new accounting standards or changes in existing standards; and adverse results (including costs, fines, reputational harm and/or other negative effects) from current or future litigation, regulatory examinations or other legal and/or regulatory actions as well as other factors identified in this press release or as detailed from time to time in our public filings, including those factors included in the disclosures under the headings “Forward-Looking Information” and “Item 1A. Risk Factors” in our most recent Annual Report on Form 10-K for the year ended December 31, 2016 or our Quarterly Reports on Form 10-Q. Should one or more of the foregoing risks materialize, or should underlying assumptions prove incorrect, actual results or outcomes may vary materially from those projected in, or implied by, such forward-looking statements. The Bank disclaims any obligation to update or revise any forward-looking statements based on the occurrence of future events, the receipt of new information or otherwise.

GENERAL INFORMATION

Bank of the Ozarks (NASDAQ: OZRK) is a regional bank providing innovative financial solutions delivered by expert bankers with a relentless pursuit of excellence. Bank of the Ozarks has been recognized as the #1 bank in the nation in its asset size for seven consecutive years. Headquartered in Little Rock, Arkansas, Bank of the Ozarks conducts operations through 251 offices in Arkansas, Georgia, Florida, North Carolina, Texas, Alabama, South Carolina, New York and California and had $20.1 billion in total assets at June 30, 2017. Bank of the Ozarks can be found at www.bankozarks.com and on Facebook, Twitter and LinkedIn or contacted at (501) 978-2265 or P.O. Box 8811, Little Rock, Arkansas 72231-8811.

   
Bank of the Ozarks
Selected Consolidated Financial Data

(Dollars in Thousands, Except Per Share Amounts)

Unaudited

 
Three Months Ended

June 30,

Six Months Ended

June 30,

2017   2016   % Change 2017   2016   % Change

Income statement data:

   
Net interest income $ 202,105 $ 119,038 69.8 % $ 392,876 $ 231,555 69.7 %
Provision for loan and lease losses 6,103 4,834 26.3 11,036 6,851 61.1
Non-interest income 31,840 22,733 40.1 60,898 42,597 43.0
Non-interest expense 83,828 50,928 64.6 162,095 98,614 64.4
Net income available to common stockholders 90,532 54,474 66.2 179,720 106,162 69.3

Common stock data:

Net income per share - diluted $ 0.73 $ 0.60 21.7 % $ 1.46 $ 1.16 25.9 %
Net income per share - basic 0.73 0.60 21.7 1.47 1.17 25.6
Cash dividends per share 0.175 0.155 12.9 0.345 0.305 13.1
Book value per share 25.43 17.16 48.2 25.43 17.16 48.2
Tangible book value per share(1) 19.85 15.51 28.0 19.85 15.51 28.0
Diluted shares outstanding (thousands) 124,198 91,288 123,084 91,268
End of period shares outstanding (thousands) 128,190 90,745 128,190 90,745

Balance sheet data at period end:

Assets $ 20,064,589 $ 12,279,579 63.4 % $ 20,064,589 $ 12,279,579 63.4 %
Non-purchased loans and leases 11,025,203 8,214,900 34.2 11,025,203 8,214,900 34.2
Purchased loans 4,159,139 1,515,104 174.5 4,159,139 1,515,104 174.5
Allowance for loan and lease losses 82,320 65,133 26.4 82,320 65,133 26.4
Foreclosed assets 34,000 23,328 45.7 34,000 23,328 45.7
Investment securities 2,101,751 824,399 154.9 2,101,751 824,399 154.9
Goodwill 660,789 126,289 423.2 660,789 126,289 423.2
Other intangibles - net of amortization 54,541 23,615 131.0 54,541 23,615 131.0
Deposits 16,241,440 10,195,072 59.3 16,241,440 10,195,072 59.3
Repurchase agreements with customers 68,502 53,997 26.9 68,502 53,997 26.9
Other borrowings 42,486 42,053 1.0 42,486 42,053 1.0
Subordinated notes 222,706 222,324 0.2 222,706 222,324 0.2
Subordinated debentures 118,519 117,962 0.5 118,519 117,962 0.5
Common stockholders’ equity 3,260,123 1,556,921 109.4 3,260,123 1,556,921 109.4

Net unrealized (losses) gains on investment securities AFS included in common stockholders' equity

(4,992 ) 15,106 (4,992 ) 15,106
Loan and lease (including purchased loans) to deposit ratio 93.49 % 95.44 % 93.49 % 95.44 %

Selected ratios:

Return on average assets (2) 1.90 % 1.91 % 1.92 % 1.95 %
Return on average common stockholders’ equity (2) 12.05 14.35 12.41 14.18
Return on average tangible common stockholders’ equity (1) (2) 15.81 15.92 16.45 15.76
Average common equity to total average assets 15.81 13.34 15.45 13.74
Net interest margin – FTE (2) 4.99 4.82 4.93 4.87
Efficiency ratio 35.32 35.41 35.18 35.46
Net charge-offs to average non-purchased loans and leases (2) (3) 0.03 0.05 0.04 0.06
Net charge-offs to average total loans and leases(2) 0.05 0.06 0.07 0.06
Nonperforming loans and leases to total loans and leases(4) 0.11 0.09 0.11 0.09
Nonperforming assets to total assets(4) 0.23 0.25 0.23 0.25

Allowance for loan and lease losses to non-purchased loans and leases(4)

0.73 0.78 0.73 0.78

Other information:

Non-accrual loans and leases(4) $ 11,628 $ 7,700 $ 11,628 $ 7,700
Accruing loans and leases - 90 days past due(4)
Troubled and restructured loans and leases(4)
Impaired purchased loans 11,679 6,387 11,679 6,387
 
 

(1)

Calculations of tangible book value per common share and return on average tangible common stockholders’ equity and the reconciliations to GAAP are included in the schedules accompanying this release.

(2)

Ratios for interim periods annualized based on actual days.

(3)

Excludes purchased loans and net charge-offs related to such loans.

(4)

Excludes purchased loans and any allowance for such loans, except for their inclusion in total assets.

 
                             
Bank of the Ozarks
Supplemental Quarterly Financial Data

(Dollars in Thousands, Except Per Share Amounts)

Unaudited

 
9/30/15 12/31/15 3/31/16 6/30/16 9/30/16 12/31/16 3/31/17 6/30/17

Earnings Summary:

Net interest income $ 96,387 $ 106,518 $ 112,517 $ 119,038 $ 175,150 $ 194,800 $ 190,771 $ 202,105
Federal tax (FTE) adjustment   2,368     2,092     1,911     2,067     2,533     3,254     3,594     3,396  
Net interest income (FTE) 98,755 108,610 114,428 121,105 177,683 198,054 194,365 205,501
Provision for loan and lease losses (3,581 ) (5,211 ) (2,017 ) (4,834 ) (7,086 ) (9,855 ) (4,933 ) (6,103 )
Non-interest income 22,138 30,540 19,865 22,733 29,231 30,571 29,058 31,840
Non-interest expense   (45,428 )   (51,646 )   (47,686 )   (50,928 )   (78,781 )   (78,358 )   (78,268 )   (83,828 )
Pretax income (FTE) 71,884 82,293 84,590 88,076 121,047 140,412 140,222 147,410
FTE adjustment (2,368 ) (2,092 ) (1,911 ) (2,067 ) (2,533 ) (3,254 ) (3,594 ) (3,396 )
Provision for income taxes (23,385 ) (28,740 ) (30,984 ) (31,514 ) (42,470 ) (49,312 ) (47,417 ) (53,488 )
Noncontrolling interest   (3 )   (6 )   (7 )   (21 )   (14 )   (59 )   (23 )   6  

Net income available to common stockholders

$ 46,128   $ 51,455   $ 51,688   $ 54,474   $ 76,030   $ 87,787   $ 89,188   $ 90,532  
Earnings per common share – diluted $ 0.52 $ 0.57 $ 0.57 $ 0.60 $ 0.66 $ 0.72 $ 0.73 $ 0.73

Non-interest Income:

Service charges on deposit accounts $ 7,425 $ 7,558 $ 7,657 $ 8,119 $ 10,926 $ 11,759 $ 11,301 $ 11,764
Mortgage lending income 1,825 1,713 1,284 2,057 2,616 2,097 1,574 1,910
Trust income 1,500 1,508 1,507 1,574 1,564 1,623 1,631 1,577
BOLI income 2,264 2,412 2,861 2,745 4,638 4,564 4,464 4,594
Other income from purchased loans 5,456 4,790 3,052 4,599 4,635 4,993 3,737 4,777
Net gains on investment securities 2,863 4 404
Gains on sales of other assets 1,905 7,463 1,027 998 594 1,537 1,619 672
Other   1,763     2,233     2,477     2,641     4,258     3,994     4,732     6,142  
Total non-interest income $ 22,138   $ 30,540   $ 19,865   $ 22,733   $ 29,231   $ 30,571   $ 29,058   $ 31,840  

Non-interest Expense:

Salaries and employee benefits $ 21,207 $ 21,504 $ 23,362 $ 24,921 $ 38,069 $ 36,481 $ 38,554 $ 39,892
Net occupancy expense 8,076 8,537 8,531 8,388 11,669 13,936 13,192 12,937
Other operating expenses 14,448 19,879 14,067 16,062 26,447 24,783 23,377 27,854
Amortization of intangibles   1,697     1,726     1,726     1,557     2,596     3,158     3,145     3,145  
Total non-interest expense $ 45,428   $ 51,646   $ 47,686   $ 50,928   $ 78,781   $ 78,358   $ 78,268   $ 83,828  

Allowance for Loan and Lease Losses:

Balance at beginning of period $ 56,749 $ 59,017 $ 60,854 $ 61,760 $ 65,133 $ 69,760 $ 76,541 $ 78,224
Net charge-offs (1,313 ) (3,374 ) (1,111 ) (1,461 ) (2,459 ) (3,074 ) (3,250 ) (2,007 )
Provision for loan and lease losses   3,581     5,211     2,017     4,834     7,086     9,855     4,933     6,103  
Balance at end of period $ 59,017   $ 60,854   $ 61,760   $ 65,133   $ 69,760   $ 76,541   $ 78,224   $ 82,320  

Selected Ratios:

Net interest margin – FTE (1) 5.07 % 4.98 % 4.92 % 4.82 % 4.90 % 5.02 % 4.88 % 4.99 %
Efficiency ratio 37.58 37.12 35.51 35.41 38.07 34.27 35.03 35.32

Net charge-offs to average non-purchased loans and leases (1) (2)

0.05 0.22 0.06 0.05 0.06 0.08 0.05 0.03

Net charge-offs to average total loans and leases (1)

0.08 0.17 0.05 0.06 0.07 0.09 0.09 0.05

Nonperforming loans and leases to total loans and leases (3)

0.26 0.20 0.15 0.09 0.08 0.15 0.11 0.11
Nonperforming assets to total assets (3) 0.41 0.37 0.29 0.25 0.28 0.31 0.25 0.23

Allowance for loan and lease losses to total non-purchased loans and leases (3)

1.08 0.91 0.80 0.78 0.78 0.78 0.75 0.73

Loans and leases past due 30 days or more, including past due non-accrual loans and leases, to total loans and leases (3)

0.41 0.28 0.23 0.22 0.17 0.16 0.16 0.15
 
 

(1)

Ratios for interim periods annualized based on actual days.

(2)

Excludes purchased loans and net charge-offs related to such loans.

(3)

Excludes purchased loans and any allowance for such loans, except for their inclusion in total assets.

 

       
Bank of the Ozarks
Average Consolidated Balance Sheets and Net Interest Analysis – FTE

Unaudited

 
Three Months Ended June 30, Six Months Ended June 30,
2017   2016 2017   2016
Average

Balance

  Income/

Expense

  Yield/

Rate

Average

Balance

    Income/

Expense

    Yield/

Rate

  Average

Balance

  Income/

Expense

  Yield/

Rate

Average

Balance

    Income/

Expense

    Yield/

Rate

(Dollars in thousands)
ASSETS        
Earning assets:
Interest earning deposits and

federal funds sold

$ 87,025 $ 115 0.53 % $ 6,048 $ 13 0.85 % $ 83,302 $ 135 0.33 % $ 4,517 $ 19 0.82 %
Investment securities:
Taxable 739,184 4,181 2.27 293,981 2,442 3.34 701,378 7,997 2.30 279,040 4,712 3.40
Tax-exempt – FTE 774,837 9,458 4.90 415,473 5,733 5.55 789,134 19,477 4.98 377,127 11,014 5.87

Non-purchased loans and leases – FTE

10,517,666 142,071 5.42 7,794,654 98,096 5.06 10,174,598 269,586 5.34 7,401,860 185,168 5.03
Purchased loans   4,391,894     75,729   6.92   1,599,013   26,711 6.72   4,598,340     151,723   6.65   1,669,920   55,734 6.71

Total earning assets – FTE

16,510,606 231,554 5.63 10,109,169 132,995 5.29 16,346,752 448,918 5.54 9,732,464 256,647 5.30

Non-interest earning assets

  2,558,960     1,338,147   2,562,131     1,225,357
Total assets $ 19,069,566   $ 11,447,316 $ 18,908,883   $ 10,957,821

LIABILITIES AND STOCKHOLDERS’ EQUITY

Interest bearing liabilities:

Deposits:

Savings and interest bearing transaction

$ 8,084,021 $ 10,912 0.54 % $ 4,742,475 $ 4,063 0.34 % $ 7,973,949 $ 19,370 0.49 % $ 4,668,940 $ 7,780 0.34 %

Time deposits of $100,000 or more

3,211,778 7,737 0.97 1,935,241 4,139 0.86 3,226,600 14,869 0.93 1,778,972 7,087 0.80
Other time deposits   1,572,703     2,830   0.72   1,312,153   2,011 0.62   1,635,929     5,617   0.69   1,149,692   3,196 0.56

Total interest bearing deposits

12,868,502 21,479 0.67 7,989,869 10,213 0.51 12,836,478 39,856 0.63 7,597,604 18,063 0.48

Repurchase agreements with customers

76,610 30 0.16 58,284 22 0.15 78,238 60 0.16 63,293 42 0.13
Other borrowings 42,365 255 2.41 42,021 293 2.80 42,251 477 2.27 46,537 595 2.57
Subordinated notes 222,660 3,052 5.50 19,557 283 5.83 222,611 6,240 5.65 9,778 283 5.83
Subordinated debentures   118,449     1,237   4.19   117,887   1,079 3.68   118,375     2,418   4.12   117,818   2,132 3.64

Total interest bearing liabilities

13,328,586 26,053 0.78 8,227,618 11,890 0.58 13,297,953 49,051 0.74 7,835,030 21,115 0.54

Non-interest bearing liabilities:

Non-interest bearing deposits

2,643,836 1,635,697 2,609,420 1,572,247

Other non-interest bearing liabilities

  79,331     53,987   77,195     41,625

Total liabilities

16,051,753 9,917,302 15,984,568 9,448,902

Common stockholders’ equity

3,014,462 1,526,828 2,921,165 1,505,742
Noncontrolling interest     3,351     3,186   3,150     3,177

Total liabilities and stockholders’ equity

  $ 19,069,566         $ 11,447,316     $ 18,908,883         $ 10,957,821    

Net interest income – FTE

$ 205,501   $ 121,105 $ 399,867   $ 235,532

Net interest margin – FTE

  4.99 %   4.82 %   4.93 %   4.87 %
 
     
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
 
Bank of the Ozarks
Calculation of Average Tangible Common
Stockholders’ Equity and the Return on
Average Tangible Common Stockholders’ Equity

Unaudited

 
Three Months Ended Six Months Ended
June 30, June 30,
2017   2016

2017

  2016
(Dollars in thousands)
Net income available to common stockholders $ 90,532   $ 54,474   $ 179,720   $ 106,162  

Average common stockholders’ equity before noncontrolling interest

$ 3,014,462 $ 1,526,828 $ 2,921,165 $ 1,505,742
Less average intangible assets:
Goodwill (660,789 ) (125,873 ) (660,472 ) (125,660 )

Core deposit and other intangibles, net of accumulated amortization

  (56,281 )   (24,468 )   (57,929 )   (25,317 )
Total average intangibles   (717,070 )   (150,341 )   (718,401 )   (150,977 )
Average tangible common stockholders’ equity $ 2,297,392   $ 1,376,487   $ 2,202,764   $ 1,354,765  
Return on average common stockholders’ equity(1)   12.05 %   14.35 %   12.41 %   14.18 %
Return on average tangible common stockholders’ equity(1)   15.81 %   15.92 %   16.45 %   15.76 %
 

(1)Ratios for interim periods annualized based on actual days.

 
 
Bank of the Ozarks
Calculation of Total Tangible Common
Stockholders’ Equity and Tangible
Book Value per Common Share

Unaudited

 
June 30,
2017   2016
(In thousands, except per share amounts)
Total common stockholders’ equity before noncontrolling interest $ 3,260,123 $ 1,556,921
Less intangible assets:
Goodwill (660,789 ) (126,289 )

Core deposit and other intangibles, net of accumulated amortization

  (54,541 )   (23,615 )
Total intangibles   (715,330 )   (149,904 )
Total tangible common stockholders’ equity $ 2,544,793   $ 1,407,017  
Shares of common stock outstanding   128,190     90,745  
Book value per common share $ 25.43   $ 17.16  
Tangible book value per common share $ 19.85   $ 15.51  
 
 
Bank of the Ozarks
Calculation of Total Tangible Common Stockholders’
Equity and the Ratio of Total Tangible Common
Stockholders’ Equity to Total Tangible Assets

Unaudited

 
June 30,
2017     2016
(Dollars in thousands)
Total common stockholders’ equity before noncontrolling interest $ 3,260,123 $ 1,556,921
Less intangible assets:
Goodwill (660,789 ) (126,289 )

Core deposit and other intangibles, net of accumulated amortization

  (54,541 )   (23,615 )
Total intangibles   (715,330 )   (149,904 )
Total tangible common stockholders’ equity $ 2,544,793   $ 1,407,017  
Total assets $ 20,064,589 $ 12,279,579
Less intangible assets:
Goodwill (660,789 ) (126,289 )

Core deposit and other intangibles, net of accumulated amortization

  (54,541 )   (23,615 )
Total intangibles   (715,330 )   (149,904 )
Total tangible assets $ 19,349,259   $ 12,129,675  
Ratio of total common stockholders’ equity to total assets   16.25 %   12.68 %

Ratio of total tangible common stockholders’ equity to total

tangible assets

  13.15 %   11.60 %

Contacts

Bank of the Ozarks
Media Contact:
Susan Blair, 501-978-2217
or
Investor Contact:
Tim Hicks, 501-978-2336

Contacts

Bank of the Ozarks
Media Contact:
Susan Blair, 501-978-2217
or
Investor Contact:
Tim Hicks, 501-978-2336