LITTLE ROCK, Ark.--(BUSINESS WIRE)--Bank OZK (the “Bank”) (Nasdaq: OZK) today announced that net income for the third quarter of 2018 was $74.2 million, a 22.7% decrease from the third quarter of 2017. Diluted earnings per common share for the third quarter of 2018 were $0.58, a 22.7% decrease from the third quarter of 2017.
On July 16, 2018, the Bank changed its name to Bank OZK, changed its ticker symbol to “OZK,” and adopted a new logo and signage, all as part of a strategic rebranding. As a result of this name change and strategic rebranding, the Bank incurred pretax expenses of $10.8 million during the third quarter and $11.4 million for the first nine months of 2018.
During the third quarter of 2018, the Bank incurred combined charge-offs of $45.5 million on two Real Estate Specialties Group (“RESG”) credits. These two unrelated projects are in South Carolina and North Carolina, have been in the Bank’s portfolio since 2007 and 2008, and were previously classified as substandard. The combined balance of these credits, after the charge-offs, is $20.6 million.
For the nine months ended September 30, 2018, net income totaled $302.1 million, a 9.6% increase from the first nine months of 2017. Diluted earnings per common share for the first nine months of 2018 were $2.35, a 6.3% increase from the first nine months of 2017.
The Bank’s annualized returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the third quarter of 2018 were 1.33%, 8.07% and 9.99%, respectively, compared to 1.89%, 11.56% and 14.76%, respectively, for the third quarter of 2017. The Bank’s annualized returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the first nine months of 2018 were 1.85%, 11.32% and 14.11%, respectively, compared to 1.91%, 12.10% and 15.81%, respectively, for the first nine months of 2017. The calculation of the Bank’s return on average tangible common stockholders’ equity and the reconciliation to generally accepted accounting principles (“GAAP”) are included in the schedules accompanying this release.
George Gleason, Chairman and Chief Executive Officer, stated, “While our third quarter results did not meet our usual high standards for performance, we are very pleased with the continued enhancement of our team, technology and business capabilities. RESG continues to be a national leader in commercial real estate finance. Our indirect RV and Marine lending business continues to grow as another exceptional national lending platform. Many of the businesses in our community bank group are successfully growing, with the expectation that some of these units may ultimately achieve national scale. Our focus is solidly on our future, and we believe we are prepared to accomplish more than ever before.”
KEY BALANCE SHEET METRICS
Total loans, including purchased loans, were $16.73 billion at September 30, 2018, a 6.0% increase from $15.78 billion at September 30, 2017. Non-purchased loans, which exclude loans acquired in previous acquisitions, were $14.44 billion at September 30, 2018, a 19.9% increase from $12.05 billion at September 30, 2017. Purchased loans, which consist of loans acquired in previous acquisitions, were $2.29 billion at September 30, 2018, a 38.8% decrease from $3.73 billion at September 30, 2017. The unfunded balance of closed loans totaled $11.89 billion at September 30, 2018, a 5.0% decrease from $12.52 billion at September 30, 2017.
Deposits were $17.82 billion at September 30, 2018, a 5.9% increase from $16.82 billion at September 30, 2017, but a 0.4% decrease from $17.90 billion at June 30, 2018. Total assets were $22.09 billion at September 30, 2018, a 6.3% increase from $20.77 billion at September 30, 2017, but a 0.6% decrease from $22.22 billion at June 30, 2018.
Common stockholders’ equity was $3.65 billion at September 30, 2018, a 9.6% increase from $3.33 billion at September 30, 2017. Tangible common stockholders’ equity was $2.95 billion at September 30, 2018, a 12.6% increase from $2.62 billion at September 30, 2017. Book value per common share was $28.41 at September 30, 2018, a 9.2% increase from $26.02 at September 30, 2017. Tangible book value per common share was $22.97 at September 30, 2018, a 12.3% increase from $20.46 at September 30, 2017. The calculations of the Bank’s tangible common stockholders’ equity and tangible book value per common share and the reconciliations to GAAP are included in the schedules accompanying this release.
The Bank’s ratio of total common stockholders’ equity to total assets was 16.54% at September 30, 2018 compared to 16.06% at September 30, 2017. Its ratio of total tangible common stockholders’ equity to total tangible assets was 13.81% at September 30, 2018 compared to 13.08% at September 30, 2017. 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 third quarter of 2018 was $220.6 million, a 5.2% increase from $209.7 million for the third quarter of 2017, but a 1.8% decrease from $224.7 million for the second quarter of 2018. Net interest margin, on a fully taxable equivalent (“FTE”) basis, was 4.47% for the third quarter of 2018, a decrease of 37 basis points from 4.84% for the third quarter of 2017. Average earning assets were $19.69 billion for the third quarter of 2018, a 12.9% increase from $17.44 billion for the third quarter of 2017.
Net interest income for the first nine months of 2018 was $663.1 million, a 10.0% increase from $602.6 million for the first nine months of 2017. Net interest margin, on a FTE basis, was 4.60% for the first nine months of 2018, a decrease of 30 basis points from 4.90% for the first nine months of 2017. Average earning assets were $19.35 billion for the first nine months of 2018, a 15.8% increase from $16.72 billion for the first nine months of 2017.
NON-INTEREST INCOME
Non-interest income for the third quarter of 2018 decreased 26.3% to $24.1 million compared to $32.7 million for the third quarter of 2017. Non-interest income for the first nine months of 2018 decreased 14.3% to $80.2 million compared to $93.6 million for the first nine months of 2017.
The Bank’s service charges on deposit accounts declined from $32.8 million for the first nine months of 2017 to $29.0 million for the first nine months of 2018 primarily due to the Durbin Amendment’s impact on the Bank’s interchange revenue effective as of July 1, 2017. The Bank’s mortgage lending income declined from $1.6 million for the third quarter and $5.1 million in the first nine months of 2017 to essentially none for the third quarter and $0.5 million in the first nine months of 2018. This was a result of the Bank’s decision in December 2017 to exit the secondary market mortgage lending business and the wind down of that business in the first half of 2018. The Bank had essentially no net gains on investment securities during the third quarter and the first nine months of 2018 compared to net gains totaling $2.4 million for the third quarter and $2.8 million for the first nine months of 2017. Net gains (losses) on sales of other assets were a net loss of $0.5 million for the third quarter and a net gain of $1.8 million for the first nine months of 2018 compared to net gains of $1.4 million for the third quarter and $3.7 million for the first nine months of 2017.
NON-INTEREST EXPENSE
Non-interest expense for the third quarter of 2018 increased 22.0% to $102.9 million compared to $84.4 million for the third quarter of 2017. Non-interest expense for the first nine months of 2018 increased 16.0% to $285.9 million compared to $246.5 million for the first nine months of 2017. Non-interest expense included $10.8 million for the third quarter and $11.4 million for the first nine months of 2018 (none in 2017) related to the name change that was effective on July 16, 2018 and the related strategic rebranding.
The Bank’s efficiency ratio (non-interest expense divided by the sum of net interest income FTE and non-interest income) for the third quarter of 2018 was 41.9% compared to 34.4% for the third quarter of 2017. The Bank’s efficiency ratio for the first nine months of 2018 was 38.3% compared to 34.9% for the first nine months of 2017.
ASSET QUALITY, CHARGE-OFFS, PROVISIONS AND ALLOWANCE
Excluding purchased loans, the Bank’s ratio of nonperforming loans as a percent of total loans was 0.23% at September 30, 2018 compared to 0.11% at September 30, 2017, and its ratio of nonperforming assets as a percent of total assets was 0.23% at September 30, 2018 compared to 0.20% at September 30, 2017.
Excluding purchased loans, the Bank’s ratio of loans past due 30 days or more, including past due non-accrual loans, to total loans was 0.17% at September 30, 2018 compared to 0.12% at September 30, 2017.
The Bank’s annualized net charge-off ratio for non-purchased loans was 1.32% for the third quarter of 2018 compared to 0.08% for the third quarter of 2017, and it was 0.49% for the first nine months of 2018 compared to 0.06% for the first nine months of 2017. The Bank’s annualized net charge-off ratio for all loans was 1.14% for the third quarter of 2018 compared to 0.09% for the third quarter of 2017, and it was 0.43% for the first nine months of 2018 compared to 0.08% for the first nine months of 2017.
The Bank’s provision for loan losses totaled $41.9 million for the third quarter and $57.1 million for the first nine months of 2018 compared to $7.8 million for the third quarter and $18.8 million for the first nine months of 2017. The increase in the Bank’s provision expense for the third quarter and the first nine months of 2018 was primarily due to the charge-offs on the two RESG credits and the associated recalibration of the allowance for loan losses.
The Bank’s allowance for loan losses for its non-purchased loans was $96.6 million, or 0.67% of total non-purchased loans, at September 30, 2018 compared to $85.2 million, or 0.71% of total non-purchased loans, at September 30, 2017. The Bank had $1.6 million of allowance for loan losses for its purchased loans at both September 30, 2018 and 2017.
MANAGEMENT’S COMMENTS, CONFERENCE CALL, TRANSCRIPT AND FILINGS
In connection with this release, the Bank released management’s comments on the results for the quarter just ended. Management will conduct a conference call to take questions on these quarterly results and management’s comments at 10:00 a.m. CT (11:00 a.m. ET) on Friday, October 19, 2018. Interested parties may listen to this call by dialing 1-844-818-5110 (U.S. and Canada) or 210-229-8841 (internationally) and asking for the Bank OZK conference call. A recorded playback of the call will be available for one week following the call at 1-855-859-2056 (U.S. and Canada) or 404-537-3406 (internationally). The passcode for this playback is 7672039. The call will be available live or in a recorded version on the Bank’s Investor Relations website at ir.ozk.com under “Company News/Webcasts.” The Bank will also provide a transcript of the conference call on its Investor Relations website.
The Bank files annual, quarterly and current reports, proxy materials and other information required by the Securities Exchange Act of 1934 with the Federal Deposit Insurance Corporation (“FDIC”), copies of which are available electronically at the FDIC’s website at https://efr.fdic.gov/fcxweb/efr/index.html and are also available on the Bank’s Investor Relations website at http://ir.ozk.com.
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 of 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, 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 or changes in the relative relationships of various interest rate indices; competitive factors and pricing pressures, including their effect on the Bank’s net interest margin or core spread; general economic, unemployment, credit market and real estate market conditions, and the effect of such conditions on the creditworthiness of borrowers, collateral values, the value of investment securities and asset recovery values; failure to receive approval of the Bank’s pending application for change in accounting methods with the Internal Revenue Service; changes in legal, financial and/or regulatory requirements; recently enacted and potential legislation and regulatory actions, including changes expected to result from the Tax Cuts and Jobs Act and the Economic Growth, Regulatory Relief and Consumer Protection Act and the costs and expenses to comply with new and/or existing legislation and regulatory actions; changes in U.S. government monetary and fiscal policy; future FDIC special assessments or changes to regular assessments; the ability to keep pace with technological changes, including changes regarding maintaining cybersecurity; the impact of failure in, or breach of, our operational or security systems or infrastructure, or those of third parties with whom we do business, including as a result of cyber-attacks or 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 or rulings as well as other factors identified in this press release or as detailed from time to time in the Bank’s public filings, including those factors included in the disclosures under the headings “Forward-Looking Information” and “Item 1A. Risk Factors” in the Bank’s most recent Annual Report on Form 10-K for the year ended December 31, 2017 and its 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 OZK (Nasdaq: OZK) is a regional bank providing innovative financial solutions delivered by expert bankers with a relentless pursuit of excellence. Bank OZK has been recognized as the #1 bank in the nation in its asset size for eight consecutive years. Headquartered in Little Rock, Arkansas, Bank OZK conducts operations through 251 offices in Arkansas, Georgia, Florida, North Carolina, Texas, Alabama, South Carolina, California, New York and Mississippi. Bank OZK can be found at www.ozk.com and on Facebook, Twitter and LinkedIn or contacted at (501) 978-2265 or P.O. Box 8811, Little Rock, Arkansas 72231-8811.
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Bank OZK Consolidated Balance Sheets Unaudited |
||||||||
| September 30, | December 31, | |||||||
| 2018 | 2017 | |||||||
| (Dollars in thousands, except per share amounts) | ||||||||
| ASSETS | ||||||||
| Cash and cash equivalents | $ | 387,766 | $ | 440,388 | ||||
| Investment securities - available for sale | 2,669,877 | 2,593,873 | ||||||
| Federal Home Loan Bank of Dallas and other banker's bank stocks | 36,279 | 28,923 | ||||||
| Non-purchased loans | 14,440,623 | 12,733,937 | ||||||
| Purchased loans | 2,285,168 | 3,309,092 | ||||||
| Allowance for loan losses | (98,200 | ) | (94,120 | ) | ||||
| Net loans | 16,627,591 | 15,948,909 | ||||||
| Premises and equipment, net | 538,523 | 519,811 | ||||||
| Foreclosed assets | 18,470 | 25,357 | ||||||
| Accrued interest receivable | 76,091 | 64,608 | ||||||
| Bank owned life insurance (“BOLI”) | 716,648 | 658,147 | ||||||
| Intangible assets, net | 699,606 | 709,040 | ||||||
| Other, net | 315,688 | 286,591 | ||||||
| Total assets | $ | 22,086,539 | $ | 21,275,647 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Deposits: | ||||||||
| Demand non-interest bearing | $ | 2,776,549 | $ | 2,726,623 | ||||
| Savings and interest bearing transaction | 9,919,192 | 10,051,122 | ||||||
| Time | 5,127,174 | 4,414,600 | ||||||
| Total deposits | 17,822,915 | 17,192,345 | ||||||
| Repurchase agreements with customers | 51,891 | 69,331 | ||||||
| Other borrowings | 1,729 | 22,320 | ||||||
| Subordinated notes | 223,185 | 222,899 | ||||||
| Subordinated debentures | 119,217 | 118,800 | ||||||
| Accrued interest payable and other liabilities | 210,968 | 186,164 | ||||||
| Total liabilities | 18,429,905 | 17,811,859 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
|
Preferred stock; $0.01 par value; 100,000,000 shares authorized; no shares issued or outstanding at September 30, 2018 or December 31, 2017 |
— | — | ||||||
|
Common stock; $0.01 par value; 300,000,000 shares authorized; 128,609,237 and 128,287,550 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively |
1,286 | 1,283 | ||||||
| Additional paid-in capital | 2,234,383 | 2,221,844 | ||||||
| Retained earnings | 1,477,178 | 1,250,313 | ||||||
| Accumulated other comprehensive loss | (59,251 | ) | (12,712 | ) | ||||
| Total stockholders’ equity before noncontrolling interest | 3,653,596 | 3,460,728 | ||||||
| Noncontrolling interest | 3,038 | 3,060 | ||||||
| Total stockholders’ equity | 3,656,634 | 3,463,788 | ||||||
| Total liabilities and stockholders’ equity | $ | 22,086,539 | $ | 21,275,647 | ||||
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Bank OZK Consolidated Statements of Income Unaudited |
||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| (Dollars in thousands, except per share amounts) | ||||||||||||||||
| Interest income: | ||||||||||||||||
| Non-purchased loans | $ | 219,847 | $ | 159,610 | $ | 620,659 | $ | 429,023 | ||||||||
| Purchased loans | 40,173 | 68,473 | 138,012 | 220,196 | ||||||||||||
| Investment securities: | ||||||||||||||||
| Taxable | 12,472 | 7,802 | 35,380 | 15,799 | ||||||||||||
| Tax-exempt | 3,991 | 5,428 | 12,252 | 18,087 | ||||||||||||
| Deposits with banks and federal funds sold | 1,112 | 253 | 2,448 | 388 | ||||||||||||
| Total interest income | 277,595 | 241,566 | 808,751 | 683,493 | ||||||||||||
| Interest expense: | ||||||||||||||||
| Deposits | 51,785 | 27,077 | 130,009 | 66,933 | ||||||||||||
| Repurchase agreements with customers | 215 | 33 | 759 | 93 | ||||||||||||
| Other borrowings | 144 | 255 | 824 | 732 | ||||||||||||
| Subordinated notes | 3,216 | 3,190 | 9,542 | 9,430 | ||||||||||||
| Subordinated debentures | 1,621 | 1,289 | 4,567 | 3,707 | ||||||||||||
| Total interest expense | 56,981 | 31,844 | 145,701 | 80,895 | ||||||||||||
| Net interest income | 220,614 | 209,722 | 663,050 | 602,598 | ||||||||||||
| Provision for loan losses | 41,949 | 7,777 | 57,126 | 18,814 | ||||||||||||
| Net interest income after provision for loan losses | 178,665 | 201,945 | 605,924 | 583,784 | ||||||||||||
| Non-interest income: | ||||||||||||||||
| Service charges on deposit accounts | 9,730 | 9,729 | 28,959 | 32,794 | ||||||||||||
| Mortgage lending income | 24 | 1,620 | 517 | 5,105 | ||||||||||||
| Trust income | 1,730 | 1,755 | 5,114 | 4,962 | ||||||||||||
| BOLI income | 5,321 | 4,453 | 18,160 | 13,511 | ||||||||||||
| Other income from purchased loans, net | 1,418 | 2,933 | 5,413 | 11,447 | ||||||||||||
| Loan service, maintenance and other fees | 4,724 | 5,274 | 15,108 | 11,407 | ||||||||||||
| Gains (losses) on sales of other assets | (518 | ) | 1,363 | 1,753 | 3,654 | |||||||||||
| Net gains on investment securities | — | 2,429 | 17 | 2,833 | ||||||||||||
| Other | 1,692 | 3,191 | 5,174 | 7,932 | ||||||||||||
| Total non-interest income | 24,121 | 32,747 | 80,215 | 93,645 | ||||||||||||
| Non-interest expense: | ||||||||||||||||
| Salaries and employee benefits | 41,477 | 35,331 | 128,641 | 113,777 | ||||||||||||
| Net occupancy and equipment | 14,358 | 13,595 | 42,335 | 39,724 | ||||||||||||
| Other operating expenses | 47,107 | 35,473 | 114,883 | 92,992 | ||||||||||||
| Total non-interest expense | 102,942 | 84,399 | 285,859 | 246,493 | ||||||||||||
| Income before taxes | 99,844 | 150,293 | 400,280 | 430,936 | ||||||||||||
| Provision for income taxes | 25,665 | 54,246 | 98,227 | 155,153 | ||||||||||||
| Net income | 74,179 | 96,047 | 302,053 | 275,783 | ||||||||||||
| Earnings attributable to noncontrolling interest | 1 | (40 | ) | 22 | (56 | ) | ||||||||||
| Net income available to common stockholders | $ | 74,180 | $ | 96,007 | $ | 302,075 | $ | 275,727 | ||||||||
| Basic earnings per common share | $ | 0.58 | $ | 0.75 | $ | 2.35 | $ | 2.21 | ||||||||
| Diluted earnings per common share | $ | 0.58 | $ | 0.75 | $ | 2.35 | $ | 2.21 | ||||||||
| Dividends declared per common share | $ | 0.20 | $ | 0.18 | $ | 0.585 | $ | 0.525 | ||||||||
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Bank OZK Consolidated Statements of Stockholders’ Equity Unaudited |
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|
Common
Stock |
Additional
Paid-In Capital |
Retained
Earnings |
Accumulated
Other Comprehensive Loss |
Non-
Controlling Interest |
Total | |||||||||||||||||||
| (Dollars in thousands, except per share amounts) | ||||||||||||||||||||||||
| Balances – December 31, 2016 | $ | 1,213 | $ | 1,901,880 | $ | 914,434 | $ | (25,920 | ) | $ | 3,264 | $ | 2,794,871 | |||||||||||
|
Cumulative effect of change in accounting principals |
— | 1,133 | 2,720 | (3,408 | ) | — | 445 | |||||||||||||||||
| Balances – January 1, 2017, as adjusted | 1,213 | 1,903,013 | 917,154 | (29,328 | ) | 3,264 | 2,795,316 | |||||||||||||||||
| Net income | — | — | 275,783 | — | — | 275,783 | ||||||||||||||||||
|
Earnings attributable to noncontrolling interest |
— | — | (56 | ) | — | 56 | — | |||||||||||||||||
| Total other comprehensive income | — | — | — | 20,294 | — | 20,294 | ||||||||||||||||||
|
Common stock dividends paid, $0.525 per share |
— | — | (65,019 | ) | — | — | (65,019 | ) | ||||||||||||||||
| Dividend paid to noncontrolling interest | — | — | — | — | (250 | ) | (250 | ) | ||||||||||||||||
|
Issuance of 158,800 shares of common stock for exercise of stock options |
2 | 2,779 | — | — | — | 2,781 | ||||||||||||||||||
|
Issuance of 238,794 shares of unvested restricted common stock |
2 | (2 | ) | — | — | — | — | |||||||||||||||||
| Stock-based compensation expense | — | 9,182 | — | — | — | 9,182 | ||||||||||||||||||
|
Forfeiture of 105,562 shares of unvested restricted common stock |
(1 | ) | 1 | — | — | — | — | |||||||||||||||||
|
Issuance of 14,476 shares of common stock to non-employee directors |
— | — | — | — | — | — | ||||||||||||||||||
|
Issuance of 6,600,000 shares of common stock, net of stock issuance costs |
66 | 299,657 | — | — | — | 299,723 | ||||||||||||||||||
| Balances – September 30, 2017 | $ | 1,282 | $ | 2,214,630 | $ | 1,127,862 | $ | (9,034 | ) | $ | 3,070 | $ | 3,337,810 | |||||||||||
| Balances – December 31, 2017 | $ | 1,283 | $ | 2,221,844 | $ | 1,250,313 | $ | (12,712 | ) | $ | 3,060 | $ | 3,463,788 | |||||||||||
| Net income | — | — | 302,053 | — | — | 302,053 | ||||||||||||||||||
| Earnings attributable to noncontrolling interest | — | — | 22 | — | (22 | ) | — | |||||||||||||||||
| Total other comprehensive loss | — | — | — | (46,539 | ) | — | (46,539 | ) | ||||||||||||||||
|
Common stock dividends paid, $0.585 per share |
— | — | (75,210 | ) | — | — | (75,210 | ) | ||||||||||||||||
|
Issuance of 216,990 shares of common stock for exercise of stock options |
2 | 5,677 | — | — | — | 5,679 | ||||||||||||||||||
|
Issuance of 220,102 shares of unvested restricted common stock |
2 | (2 | ) | — | — | — | — | |||||||||||||||||
|
Repurchase and cancellation of 71,750 shares of common stock |
(1 | ) | (3,769 | ) | — | — | — | (3,770 | ) | |||||||||||||||
| Stock-based compensation expense | — | 10,633 | — | — | — | 10,633 | ||||||||||||||||||
|
Forfeiture of 43,655 shares of unvested restricted common stock |
— | — | — | — | — | — | ||||||||||||||||||
| Balances – September 30, 2018 | $ | 1,286 | $ | 2,234,383 | $ | 1,477,178 | $ | (59,251 | ) | $ | 3,038 | $ | 3,656,634 | |||||||||||
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Bank OZK Summary of Non-Interest Expense Unaudited |
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| Three Months Ended | Nine Months Ended | ||||||||||||||
| September 30, | September 30, | ||||||||||||||
| 2018 | 2017 | 2018 | 2017 | ||||||||||||
| (Dollars in thousands) | |||||||||||||||
| Salaries and employee benefits | $ | 41,477 | $ | 35,331 | $ | 128,641 | $ | 113,777 | |||||||
| Net occupancy and equipment | 14,358 | 13,595 | 42,335 | 39,724 | |||||||||||
| Other operating expenses: | |||||||||||||||
| Professional and outside services | 9,725 | 10,018 | 27,542 | 22,171 | |||||||||||
| Telecommunication services | 3,373 | 3,321 | 10,056 | 10,398 | |||||||||||
| Software and data processing | 3,336 | 2,982 | 9,786 | 7,745 | |||||||||||
| Postage and supplies | 2,517 | 1,852 | 6,930 | 5,706 | |||||||||||
| Advertising and public relations | 6,977 | 1,907 | 10,084 | 4,355 | |||||||||||
| ATM expense | 1,202 | 1,430 | 3,683 | 4,081 | |||||||||||
| Travel and meals | 2,517 | 2,223 | 7,168 | 6,138 | |||||||||||
| FDIC insurance | 3,300 | 3,500 | 8,700 | 7,000 | |||||||||||
| FDIC and state assessments | 648 | 881 | 2,368 | 2,531 | |||||||||||
| Loan collection and repossession expense | 932 | 1,249 | 2,225 | 4,354 | |||||||||||
| Writedowns of foreclosed and other assets | 544 | 1,028 | 1,156 | 2,494 | |||||||||||
| Writedown of signage due to strategic rebranding | 4,915 | — | 4,915 | — | |||||||||||
| Amortization of intangibles | 3,145 | 3,145 | 9,435 | 9,435 | |||||||||||
| Other | 3,976 | 1,937 | 10,835 | 6,584 | |||||||||||
| Total non-interest expense | $ | 102,942 | $ | 84,399 | $ | 285,859 | $ | 246,493 | |||||||
|
Bank OZK Summary of Total Loans Outstanding Unaudited |
||||||||||||||||
| September 30, 2018 | December 31, 2017 | |||||||||||||||
| (Dollars in thousands) | ||||||||||||||||
| Real estate: | ||||||||||||||||
| Residential 1-4 family | $ | 1,055,238 | 6.3 | % | $ | 1,174,427 | 7.3 | % | ||||||||
| Non-farm/non-residential | 4,253,779 | 25.4 | 4,478,876 | 27.9 | ||||||||||||
| Construction/land development | 6,498,207 | 38.9 | 6,648,061 | 41.5 | ||||||||||||
| Agricultural | 165,936 | 1.0 | 150,003 | 0.9 | ||||||||||||
| Multifamily residential | 995,368 | 5.9 | 508,514 | 3.2 | ||||||||||||
| Total real estate | 12,968,528 | 77.5 | 12,959,881 | 80.8 | ||||||||||||
| Commercial and industrial | 935,087 | 5.6 | 738,225 | 4.6 | ||||||||||||
| Consumer | 2,127,380 | 12.7 | 1,472,593 | 9.2 | ||||||||||||
| Other | 694,796 | 4.2 | 872,330 | 5.4 | ||||||||||||
| Total loans | $ | 16,725,791 | 100.0 | % | $ | 16,043,029 | 100.0 | % | ||||||||
|
Bank OZK Selected Consolidated Financial Data (Dollars in thousands, except per share amounts) Unaudited |
||||||||||||||||||||||||
|
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||||||||||
| 2018 | 2017 | % Change | 2018 | 2017 | % Change | |||||||||||||||||||
|
Income statement data: |
||||||||||||||||||||||||
| Net interest income | $ | 220,614 | $ | 209,722 | 5.2 | % | $ | 663,050 | $ | 602,598 | 10.0 | % | ||||||||||||
| Provision for loan losses | 41,949 | 7,777 | 439.4 | 57,126 | 18,814 | 203.6 | ||||||||||||||||||
| Non-interest income | 24,121 | 32,747 | (26.3 | ) | 80,215 | 93,645 | (14.3 | ) | ||||||||||||||||
| Non-interest expense | 102,942 | 84,399 | 22.0 | 285,859 | 246,493 | 16.0 | ||||||||||||||||||
| Net income available to common stockholders | 74,180 | 96,007 | (22.7 | ) | 302,075 | 275,727 | 9.6 | |||||||||||||||||
|
Common stock data: |
||||||||||||||||||||||||
| Net income per share - diluted | $ | 0.58 | $ | 0.75 | (22.7 | )% | $ | 2.35 | $ | 2.21 | 6.3 | % | ||||||||||||
| Net income per share - basic | 0.58 | 0.75 | (22.7 | ) | 2.35 | 2.21 | 6.3 | |||||||||||||||||
| Cash dividends per share | 0.20 | 0.18 | 11.1 | 0.585 | 0.525 | 11.4 | ||||||||||||||||||
| Book value per share | 28.41 | 26.02 | 9.2 | 28.41 | 26.02 | 9.2 | ||||||||||||||||||
| Tangible book value per share(1) | 22.97 | 20.46 | 12.3 | 22.97 | 20.46 | 12.3 | ||||||||||||||||||
| Diluted shares outstanding (thousands) | 128,744 | 128,472 | 128,771 | 124,900 | ||||||||||||||||||||
| End of period shares outstanding (thousands) | 128,609 | 128,174 | 128,609 | 128,174 | ||||||||||||||||||||
|
Balance sheet data at period end: |
||||||||||||||||||||||||
| Assets | $ | 22,086,539 | $ | 20,768,493 | 6.3 | % | $ | 22,086,539 | $ | 20,768,493 | 6.3 | % | ||||||||||||
| Total loans | 16,725,791 | 15,778,630 | 6.0 | 16,725,791 | 15,778,630 | 6.0 | ||||||||||||||||||
| Non-purchased loans | 14,440,623 | 12,047,094 | 19.9 | 14,440,623 | 12,047,094 | 19.9 | ||||||||||||||||||
| Purchased loans | 2,285,168 | 3,731,536 | (38.8 | ) | 2,285,168 | 3,731,536 | (38.8 | ) | ||||||||||||||||
| Allowance for loan losses | 98,200 | 86,784 | 13.2 | 98,200 | 86,784 | 13.2 | ||||||||||||||||||
| Foreclosed assets | 18,470 | 28,016 | (34.1 | ) | 18,470 | 28,016 | (34.1 | ) | ||||||||||||||||
| Investment securities | 2,706,156 | 1,975,102 | 37.0 | 2,706,156 | 1,975,102 | 37.0 | ||||||||||||||||||
| Goodwill and other intangible assets | 699,606 | 712,185 | (1.8 | ) | 699,606 | 712,185 | (1.8 | ) | ||||||||||||||||
| Deposits | 17,822,915 | 16,823,359 | 5.9 | 17,822,915 | 16,823,359 | 5.9 | ||||||||||||||||||
| Repurchase agreements with customers | 51,891 | 70,165 | (26.0 | ) | 51,891 | 70,165 | (26.0 | ) | ||||||||||||||||
| Other borrowings | 1,729 | 42,404 | (95.9 | ) | 1,729 | 42,404 | (95.9 | ) | ||||||||||||||||
| Subordinated notes | 223,185 | 222,802 | 0.2 | 223,185 | 222,802 | 0.2 | ||||||||||||||||||
| Subordinated debentures | 119,217 | 118,660 | 0.5 | 119,217 | 118,660 | 0.5 | ||||||||||||||||||
| Unfunded balance of closed loans | 11,891,247 | 12,519,839 | (5.0 | ) | 11,891,247 | 12,519,839 | (5.0 | ) | ||||||||||||||||
| Common stockholders’ equity | 3,653,596 | 3,334,740 | 9.6 | 3,653,596 | 3,334,740 | 9.6 | ||||||||||||||||||
|
Net unrealized losses on investment securities AFS included in common stockholders' equity |
(59,251 | ) | (5,626 | ) | (59,251 | ) | (5,626 | ) | ||||||||||||||||
| Loan (including purchased loans) to deposit ratio | 93.84 | % | 93.79 | % | 93.84 | % | 93.79 | % | ||||||||||||||||
|
Selected ratios: |
||||||||||||||||||||||||
| Return on average assets(2) | 1.33 | % | 1.89 | % | 1.85 | % | 1.91 | % | ||||||||||||||||
| Return on average common stockholders’ equity(2) | 8.07 | 11.56 | 11.32 | 12.10 | ||||||||||||||||||||
| Return on average tangible common stockholders’ equity(1) (2) | 9.99 | 14.76 | 14.11 | 15.81 | ||||||||||||||||||||
| Average common equity to total average assets | 16.47 | 16.35 | 16.38 | 15.77 | ||||||||||||||||||||
| Net interest margin – FTE(2) | 4.47 | 4.84 | 4.60 | 4.90 | ||||||||||||||||||||
| Efficiency ratio | 41.87 | 34.38 | 38.28 | 34.90 | ||||||||||||||||||||
| Net charge-offs to average non-purchased loans(2) (3) | 1.32 | 0.08 | 0.49 | 0.06 | ||||||||||||||||||||
| Net charge-offs to average total loans(2) | 1.14 | 0.09 | 0.43 | 0.08 | ||||||||||||||||||||
| Nonperforming loans to total loans(4) | 0.23 | 0.11 | 0.23 | 0.11 | ||||||||||||||||||||
| Nonperforming assets to total assets(4) | 0.23 | 0.20 | 0.23 | 0.20 | ||||||||||||||||||||
| Allowance for loan losses to non-purchased loans(5) | 0.67 | 0.71 | 0.67 | 0.71 | ||||||||||||||||||||
|
Other information: |
||||||||||||||||||||||||
| Non-accrual loans(4) | $ | 32,960 | $ | 13,269 | $ | 32,960 | $ | 13,269 | ||||||||||||||||
| Accruing loans - 90 days past due(4) | — | — | — | — | ||||||||||||||||||||
| Troubled and restructured loans(4) | — | — | — | — | ||||||||||||||||||||
| Impaired purchased loans | 5,064 | 9,502 | 5,064 | 9,502 | ||||||||||||||||||||
|
(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, except for their inclusion in total assets. |
|
(5) |
Excludes purchased loans and any allowance for such loans. |
|
Bank OZK Supplemental Quarterly Financial Data (Dollars in thousands, except per share amounts) Unaudited |
||||||||||||||||||||||||||||||||
| 12/31/16 | 3/31/17 | 6/30/17 | 9/30/17 | 12/31/17 | 3/31/18 | 6/30/18 | 9/30/18 | |||||||||||||||||||||||||
|
Earnings Summary: |
||||||||||||||||||||||||||||||||
| Net interest income | $ | 194,800 | $ | 190,771 | $ | 202,105 | $ | 209,722 | $ | 214,831 | $ | 217,776 | $ | 224,661 | $ | 220,614 | ||||||||||||||||
| Federal tax (FTE) adjustment | 3,254 | 3,594 | 3,396 | 3,014 | 2,450 | 1,166 | 1,151 | 1,132 | ||||||||||||||||||||||||
| Net interest income (FTE) | 198,054 | 194,365 | 205,501 | 212,736 | 217,281 | 218,942 | 225,812 | 221,746 | ||||||||||||||||||||||||
| Provision for loan losses | (9,855 | ) | (4,933 | ) | (6,103 | ) | (7,777 | ) | (9,279 | ) | (5,567 | ) | (9,610 | ) | (41,949 | ) | ||||||||||||||||
| Non-interest income | 30,571 | 29,058 | 31,840 | 32,747 | 30,213 | 28,707 | 27,386 | 24,121 | ||||||||||||||||||||||||
| Non-interest expense | (78,358 | ) | (78,268 | ) | (83,828 | ) | (84,399 | ) | (86,177 | ) | (93,810 | ) | (89,107 | ) | (102,942 | ) | ||||||||||||||||
| Pretax income (FTE) | 140,412 | 140,222 | 147,410 | 153,307 | 152,038 | 148,272 | 154,481 | 100,976 | ||||||||||||||||||||||||
| FTE adjustment | (3,254 | ) | (3,594 | ) | (3,396 | ) | (3,014 | ) | (2,450 | ) | (1,166 | ) | (1,151 | ) | (1,132 | ) | ||||||||||||||||
| Provision for income taxes | (49,312 | ) | (47,417 | ) | (53,488 | ) | (54,246 | ) | (3,434 | ) | (33,973 | ) | (38,589 | ) | (25,665 | ) | ||||||||||||||||
| Noncontrolling interest | (59 | ) | (23 | ) | 6 | (40 | ) | 10 | 11 | 10 | 1 | |||||||||||||||||||||
|
Net income available to common stockholders |
$ | 87,787 | $ | 89,188 | $ | 90,532 | $ | 96,007 | $ | 146,164 | $ | 113,144 | $ | 114,751 | $ | 74,180 | ||||||||||||||||
| Earnings per common share – diluted | $ | 0.72 | $ | 0.73 | $ | 0.73 | $ | 0.75 | $ | 1.14 | $ | 0.88 | $ | 0.89 | $ | 0.58 | ||||||||||||||||
|
Non-interest Income: |
||||||||||||||||||||||||||||||||
| Service charges on deposit accounts | $ | 11,759 | $ | 11,301 | $ | 11,764 | $ | 9,729 | $ | 10,058 | $ | 9,525 | $ | 9,704 | $ | 9,730 | ||||||||||||||||
| Mortgage lending income | 2,097 | 1,574 | 1,910 | 1,620 | 1,294 | 492 | 1 | 24 | ||||||||||||||||||||||||
| Trust income | 1,623 | 1,631 | 1,577 | 1,755 | 1,729 | 1,793 | 1,591 | 1,730 | ||||||||||||||||||||||||
| BOLI income | 4,564 | 4,464 | 4,594 | 4,453 | 5,166 | 7,580 | 5,259 | 5,321 | ||||||||||||||||||||||||
| Other income from purchased loans | 4,993 | 3,737 | 4,777 | 2,933 | 2,009 | 1,251 | 2,744 | 1,418 | ||||||||||||||||||||||||
|
Loan service, maintenance and other fees |
2,962 | 2,706 | 3,427 | 5,274 | 4,289 | 4,743 | 5,641 | 4,724 | ||||||||||||||||||||||||
| Gains (losses) on sales of other assets | 1,537 | 1,619 | 672 | 1,363 | 1,899 | 1,426 | 844 | (518 | ) | |||||||||||||||||||||||
| Net gains on investment securities | 4 | — | 404 | 2,429 | 1,201 | 17 | — | — | ||||||||||||||||||||||||
| Other | 1,032 | 2,026 | 2,715 | 3,191 | 2,568 | 1,880 | 1,602 | 1,692 | ||||||||||||||||||||||||
| Total non-interest income | $ | 30,571 | $ | 29,058 | $ | 31,840 | $ | 32,747 | $ | 30,213 | $ | 28,707 | $ | 27,386 | $ | 24,121 | ||||||||||||||||
|
Non-interest Expense: |
||||||||||||||||||||||||||||||||
| Salaries and employee benefits | $ | 36,481 | $ | 38,554 | $ | 39,892 | $ | 35,331 | $ | 38,417 | $ | 45,499 | $ | 41,665 | $ | 41,477 | ||||||||||||||||
| Net occupancy expense | 13,936 | 13,192 | 12,937 | 13,595 | 13,474 | 14,150 | 13,827 | 14,358 | ||||||||||||||||||||||||
| Other operating expenses | 27,941 | 26,522 | 30,999 | 35,473 | 34,286 | 34,161 | 33,615 | 47,107 | ||||||||||||||||||||||||
| Total non-interest expense | $ | 78,358 | $ | 78,268 | $ | 83,828 | $ | 84,399 | $ | 86,177 | $ | 93,810 | $ | 89,107 | $ | 102,942 | ||||||||||||||||
|
Balance Sheet Data: |
||||||||||||||||||||||||||||||||
| Total assets | $ | 18,890,142 | $ | 19,152,212 | $ | 20,064,589 | $ | 20,768,493 | $ | 21,275,647 | $ | 22,039,439 | $ | 22,220,380 | $ | 22,086,539 | ||||||||||||||||
| Non-purchased loans | 9,605,093 | 10,216,875 | 11,025,203 | 12,047,094 | 12,733,937 | 13,674,561 | 14,183,533 | 14,440,623 | ||||||||||||||||||||||||
| Purchased loans | 4,958,022 | 4,580,047 | 4,159,139 | 3,731,536 | 3,309,092 | 2,934,535 | 2,580,341 | 2,285,168 | ||||||||||||||||||||||||
| Investment securities | 1,471,612 | 1,470,568 | 2,101,751 | 1,975,102 | 2,622,796 | 2,612,961 | 2,617,859 | 2,706,156 | ||||||||||||||||||||||||
| Deposits | 15,574,878 | 15,713,427 | 16,241,440 | 16,823,359 | 17,192,345 | 17,833,672 | 17,897,085 | 17,822,915 | ||||||||||||||||||||||||
| Unfunded balance of closed loans | 10,070,043 | 11,258,762 | 11,883,679 | 12,519,839 | 13,192,439 | 12,551,032 | 11,999,661 | 11,891,247 | ||||||||||||||||||||||||
| Common stockholders' equity | 2,791,607 | 2,873,317 | 3,260,123 | 3,334,740 | 3,460,728 | 3,526,605 | 3,613,903 | 3,653,596 | ||||||||||||||||||||||||
|
Allowance for Loan Losses: |
||||||||||||||||||||||||||||||||
| Balance at beginning of period | $ | 69,760 | $ | 76,541 | $ | 78,224 | $ | 82,320 | $ | 86,784 | $ | 94,120 | $ | 98,097 | $ | 104,638 | ||||||||||||||||
| Net charge-offs | (3,074 | ) | (3,250 | ) | (2,007 | ) | (3,313 | ) | (1,943 | ) | (1,590 | ) | (3,069 | ) | (48,387 | ) | ||||||||||||||||
| Provision for loan losses | 9,855 | 4,933 | 6,103 | 7,777 | 9,279 | 5,567 | 9,610 | 41,949 | ||||||||||||||||||||||||
| Balance at end of period | $ | 76,541 | $ | 78,224 | $ | 82,320 | $ | 86,784 | $ | 94,120 | $ | 98,097 | $ | 104,638 | $ | 98,200 | ||||||||||||||||
|
Selected Ratios: |
||||||||||||||||||||||||||||||||
| Net interest margin – FTE(1) | 5.02 | % | 4.88 | % | 4.99 | % | 4.84 | % | 4.72 | % | 4.69 | % | 4.66 | % | 4.47 | % | ||||||||||||||||
| Efficiency ratio | 34.27 | 35.03 | 35.32 | 34.38 | 34.82 | 37.88 | 35.19 | 41.87 | ||||||||||||||||||||||||
|
Net charge-offs to average non-purchased loans(1) (2) |
0.08 | 0.05 | 0.03 | 0.08 | 0.08 | 0.04 | 0.05 | 1.32 | ||||||||||||||||||||||||
|
Net charge-offs to average total loans(1) |
0.09 | 0.09 | 0.05 | 0.09 | 0.05 | 0.04 | 0.07 | 1.14 | ||||||||||||||||||||||||
|
Nonperforming loans to total loans(3) |
0.15 | 0.11 | 0.11 | 0.11 | 0.10 | 0.09 | 0.10 | 0.23 | ||||||||||||||||||||||||
| Nonperforming assets to total assets(3) | 0.31 | 0.25 | 0.23 | 0.20 | 0.18 | 0.16 | 0.15 | 0.23 | ||||||||||||||||||||||||
|
Allowance for loan losses to total non-purchased loans(4) |
0.78 | 0.75 | 0.73 | 0.71 | 0.73 | 0.71 | 0.73 | 0.67 | ||||||||||||||||||||||||
|
Loans past due 30 days or more, including past due non-accrual loans, to total loans(3) |
0.16 | 0.16 | 0.15 | 0.12 | 0.15 | 0.14 | 0.12 | 0.17 | ||||||||||||||||||||||||
|
(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, except for their inclusion in total assets. |
|
(4)Excludes purchased loans and any allowance for such loans. |
|
Bank OZK Average Consolidated Balance Sheets and Net Interest Analysis – FTE Unaudited |
||||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||||||||||||||||||||||||||
|
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 | $ | 240,665 | $ | 1,112 | 1.83 | % | $ | 102,972 | $ | 253 | 0.98 | % | $ | 179,429 | $ | 2,448 | 1.82 | % | $ | 89,930 | $ | 388 | 0.58 | % | ||||||||||||||||||||||||
| Investment securities: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Taxable | 2,117,498 | 12,472 | 2.34 | 1,397,768 | 7,802 | 2.21 | 2,078,710 | 35,380 | 2.28 | 936,059 | 15,799 | 2.26 | ||||||||||||||||||||||||||||||||||||
| Tax-exempt – FTE | 532,503 | 5,051 | 3.76 | 703,873 | 8,351 | 4.71 | 544,728 | 15,509 | 3.81 | 760,401 | 27,827 | 4.89 | ||||||||||||||||||||||||||||||||||||
| Non-purchased loans – FTE | 14,363,015 | 219,919 | 6.07 | 11,248,314 | 159,701 | 5.63 | 13,760,166 | 620,851 | 6.03 | 10,536,436 | 429,287 | 5.45 | ||||||||||||||||||||||||||||||||||||
| Purchased loans | 2,436,888 | 40,173 | 6.54 | 3,988,881 | 68,473 | 6.81 | 2,789,226 | 138,012 | 6.62 | 4,392,955 | 220,196 | 6.70 | ||||||||||||||||||||||||||||||||||||
| Total earning assets – FTE | 19,690,569 | 278,727 | 5.62 | 17,441,808 | 244,580 | 5.56 | 19,352,259 | 812,200 | 5.61 | 16,715,781 | 693,497 | 5.55 | ||||||||||||||||||||||||||||||||||||
| Non-interest earning assets | 2,457,577 | 2,714,176 | 2,421,623 | 2,613,342 | ||||||||||||||||||||||||||||||||||||||||||||
| Total assets | $ | 22,148,146 | $ | 20,155,984 | $ | 21,773,882 | $ | 19,329,123 | ||||||||||||||||||||||||||||||||||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||||||||||||||||||||||||||||||
| Interest bearing liabilities: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Deposits: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Savings and interest bearing transaction | $ | 10,231,569 | $ | 33,753 | 1.31 | % | $ | 8,972,419 | $ | 16,074 | 0.71 | % | $ | 10,113,882 | $ | 85,571 | 1.13 | % | $ | 8,310,430 | $ | 35,445 | 0.57 | % | ||||||||||||||||||||||||
| Time deposits of $100 or more | 3,306,014 | 13,288 | 1.59 | 3,164,875 | 8,135 | 1.02 | 3,175,855 | 33,096 | 1.39 | 3,205,799 | 23,003 | 0.96 | ||||||||||||||||||||||||||||||||||||
| Other time deposits | 1,580,886 | 4,744 | 1.19 | 1,518,430 | 2,868 | 0.75 | 1,492,575 | 11,342 | 1.02 | 1,596,332 | 8,485 | 0.71 | ||||||||||||||||||||||||||||||||||||
| Total interest bearing deposits | 15,118,469 | 51,785 | 1.36 | 13,655,724 | 27,077 | 0.79 | 14,782,312 | 130,009 | 1.18 | 13,112,561 | 66,933 | 0.68 | ||||||||||||||||||||||||||||||||||||
| Repurchase agreements with customers | 97,249 | 215 | 0.88 | 73,026 | 33 | 0.18 | 123,587 | 759 | 0.82 | 76,481 | 93 | 0.16 | ||||||||||||||||||||||||||||||||||||
| Other borrowings | 63,909 | 144 | 0.90 | 42,433 | 255 | 2.39 | 88,101 | 824 | 1.25 | 42,312 | 732 | 2.31 | ||||||||||||||||||||||||||||||||||||
| Subordinated notes | 223,135 | 3,216 | 5.72 | 222,749 | 3,190 | 5.68 | 223,042 | 9,542 | 5.72 | 222,658 | 9,430 | 5.66 | ||||||||||||||||||||||||||||||||||||
| Subordinated debentures | 119,145 | 1,621 | 5.40 | 118,582 | 1,289 | 4.31 | 119,006 | 4,567 | 5.13 | 118,445 | 3,707 | 4.18 | ||||||||||||||||||||||||||||||||||||
| Total interest bearing liabilities | 15,621,907 | 56,981 | 1.45 | 14,112,514 | 31,844 | 0.90 | 15,336,048 | 145,701 | 1.27 | 13,572,457 | 80,895 | 0.80 | ||||||||||||||||||||||||||||||||||||
| Non-interest bearing liabilities: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Non-interest bearing deposits | 2,685,802 | 2,662,265 | 2,689,818 | 2,627,214 | ||||||||||||||||||||||||||||||||||||||||||||
| Other non-interest bearing liabilities | 189,003 | 82,764 | 177,824 | 79,056 | ||||||||||||||||||||||||||||||||||||||||||||
| Total liabilities | 18,496,712 | 16,857,543 | 18,203,690 | 16,278,727 | ||||||||||||||||||||||||||||||||||||||||||||
| Common stockholders’ equity | 3,648,398 | 3,295,394 | 3,567,148 | 3,047,279 | ||||||||||||||||||||||||||||||||||||||||||||
| Noncontrolling interest | 3,036 | 3,047 | 3,044 | 3,117 | ||||||||||||||||||||||||||||||||||||||||||||
| Total liabilities and stockholders’ equity | $ | 22,148,146 | $ | 20,155,984 | $ | 21,773,882 | $ | 19,329,123 | ||||||||||||||||||||||||||||||||||||||||
| Net interest income – FTE | $ | 221,746 | $ | 212,736 | $ | 666,499 | $ | 612,602 | ||||||||||||||||||||||||||||||||||||||||
| Net interest margin – FTE | 4.47 | % | 4.84 | % | 4.60 | % | 4.90 | % | ||||||||||||||||||||||||||||||||||||||||
|
Bank OZK Reconciliation of Non-GAAP Financial Measures
Calculation of Average Tangible Common Stockholders’ Equity and the Annualized Return on Average Tangible Common Stockholders’ Equity Unaudited |
||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| (Dollars in thousands) | ||||||||||||||||
| Net income available to common stockholders | $ | 74,180 | $ | 96,007 | $ | 302,075 | $ | 275,727 | ||||||||
|
Average common stockholders’ equity before noncontrolling interest |
$ | 3,648,398 | $ | 3,295,394 | $ | 3,567,148 | $ | 3,047,279 | ||||||||
| Less average intangible assets: | ||||||||||||||||
| Goodwill | (660,789 | ) | (660,789 | ) | (660,789 | ) | (659,871 | ) | ||||||||
|
Core deposit and other intangibles, net of accumulated amortization |
(40,743 | ) | (53,128 | ) | (43,886 | ) | (56,311 | ) | ||||||||
| Total average intangibles | (701,532 | ) | (713,917 | ) | (704,675 | ) | (716,182 | ) | ||||||||
| Average tangible common stockholders’ equity | $ | 2,946,866 | $ | 2,581,477 | $ | 2,862,473 | $ | 2,331,097 | ||||||||
| Return on average common stockholders’ equity(1) | 8.07 | % | 11.56 | % | 11.32 | % | 12.10 | % | ||||||||
| Return on average tangible common stockholders’ equity(1) | 9.99 | % | 14.76 | % | 14.11 | % | 15.81 | % | ||||||||
| (1)Ratios for interim periods annualized based on actual days. |
|
Calculation of Total Tangible Common Stockholders’ Equity and Tangible Book Value per Common Share Unaudited |
||||||||
| September 30, | ||||||||
| 2018 | 2017 | |||||||
| (In thousands, except per share amounts) | ||||||||
| Total common stockholders’ equity before noncontrolling interest | $ | 3,653,596 | $ | 3,334,740 | ||||
| Less intangible assets: | ||||||||
| Goodwill | (660,789 | ) | (660,789 | ) | ||||
| Core deposit and other intangible assets, net of accumulated amortization | (38,817 | ) | (51,396 | ) | ||||
| Total intangibles | (699,606 | ) | (712,185 | ) | ||||
| Total tangible common stockholders’ equity | $ | 2,953,990 | $ | 2,622,555 | ||||
| Shares of common stock outstanding | 128,609 | 128,174 | ||||||
| Book value per common share | $ | 28.41 | $ | 26.02 | ||||
| Tangible book value per common share | $ | 22.97 | $ | 20.46 | ||||
|
Calculation of Total Tangible Common Stockholders’ Equity and the Ratio of Total Tangible Common Stockholders’ Equity to Total Tangible Assets Unaudited |
||||||||
| September 30, | ||||||||
| 2018 | 2017 | |||||||
| (Dollars in thousands) | ||||||||
| Total common stockholders’ equity before noncontrolling interest | $ | 3,653,596 | $ | 3,334,740 | ||||
| Less intangible assets: | ||||||||
| Goodwill | (660,789 | ) | (660,789 | ) | ||||
| Core deposit and other intangible assets, net of accumulated amortization | (38,817 | ) | (51,396 | ) | ||||
| Total intangibles | (699,606 | ) | (712,185 | ) | ||||
| Total tangible common stockholders’ equity | $ | 2,953,990 | $ | 2,622,555 | ||||
| Total assets | $ | 22,086,539 | $ | 20,768,493 | ||||
| Less intangible assets: | ||||||||
| Goodwill | (660,789 | ) | (660,789 | ) | ||||
| Core deposit and other intangible assets, net of accumulated amortization | (38,817 | ) | (51,396 | ) | ||||
| Total intangibles | (699,606 | ) | (712,185 | ) | ||||
| Total tangible assets | $ | 21,386,933 | $ | 20,056,308 | ||||
| Ratio of total common stockholders’ equity to total assets | 16.54 | % | 16.06 | % | ||||
|
Ratio of total tangible common stockholders’ equity to total tangible assets |
13.81 | % | 13.08 | % | ||||
