Press Release

Bank OZK Announces First Quarter 2019 Earnings

Company Release - 4/17/2019 4:01 PM ET

LITTLE ROCK, Ark., April 17, 2019 (GLOBE NEWSWIRE) -- Bank OZK (the “Bank”) (Nasdaq: OZK) today announced that net income for the first quarter of 2019 was $110.7 million, a 2.2% decrease from net income of $113.1 million for the first quarter of 2018. The Bank’s net income for the first quarter of 2019 included no tax-exempt bank owned life insurance (“BOLI”) death benefits compared to $2.7 million in the first quarter of 2018. Diluted earnings per common share for the first quarter of 2019 were $0.86, a 2.3% decrease from $0.88 for the first quarter of 2018.

The Bank’s annualized returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the first quarter of 2019 were 1.99%, 11.77% and 14.40%, respectively, compared to 2.16%, 13.17% and 16.53%, respectively, for the first quarter of 2018. 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, “We are pleased with our first quarter results. Our $110.7 million net income, 1.99% annualized return on average assets, 4.53% net interest margin and 38.5% efficiency ratio provide an excellent start for 2019. Our team of industry and technology professionals is well-positioned to capitalize on opportunities throughout 2019 and beyond.”

KEY BALANCE SHEET METRICS

Total loans were $17.48 billion at March 31, 2019, a 5.2% increase from $16.61 billion at March 31, 2018. Non-purchased loans, which exclude loans acquired in previous acquisitions, were $15.61 billion at March 31, 2019, a 14.2% increase from $13.67 billion at March 31, 2018. Purchased loans, which consist of loans acquired in previous acquisitions, were $1.86 billion at March 31, 2019, a 36.5% decrease from $2.93 billion at March 31, 2018. 

Deposits were $18.48 billion at March 31, 2019, a 3.6% increase from $17.83 billion at March 31, 2018. Total assets were $23.01 billion at March 31, 2019, a 4.4% increase from $22.04 billion at March 31, 2018.

Common stockholders’ equity was $3.88 billion at March 31, 2019, a 10.1% increase from $3.53 billion at March 31, 2018. Tangible common stockholders’ equity was $3.19 billion at March 31, 2019, a 13.1% increase from $2.82 billion at March 31, 2018. Book value per common share was $30.11 at March 31, 2019, a 9.8% increase from $27.42 at March 31, 2018. Tangible book value per common share was $24.73 at March 31, 2019, a 12.8% increase from $21.93 at March 31, 2018. 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 increased to 16.88% at March 31, 2019 compared to 16.00% at March 31, 2018. Its ratio of total tangible common stockholders’ equity to total tangible assets increased to 14.29% at March 31, 2019 compared to 13.22% at March 31, 2018. 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. 

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, which are available at http://ir.ozk.com. This release should be read in conjunction with management’s comments on the results for the first quarter of 2019. 

Management will conduct a conference call to take questions on these quarterly results and management’s comments at 3:00 p.m. CT (4:00 p.m. ET) on April 18, 2019. 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 3885035. 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. To receive automated email alerts for these materials, please visit http://ir.ozk.com/EmailNotification to sign up.

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; changes in legal, financial and/or regulatory requirements; recently enacted and potential legislation and regulatory actions 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; 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 other public reports the Bank files with the FDIC, 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, 2018 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 top performing bank in the nation in its asset size 13 times in the past eight years. Headquartered in Little Rock, Arkansas, Bank OZK conducts operations through 254 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. 

 

Bank OZK
Consolidated Balance Sheets

Unaudited

     
  March 31,  December 31, 
  2019  2018 
       
  (Dollars in thousands, except per share amounts) 
ASSETS        
Cash and cash equivalents $607,698  $290,672 
Investment securities - available for sale ("AFS")  2,769,602   2,862,340 
Federal Home Loan Bank of Dallas and other banker's bank stocks  12,089   25,941 
Non-purchased loans  15,610,681   15,073,791 
Purchased loans  1,864,715   2,044,032 
Allowance for loan losses  (105,954)  (102,264)
Net loans  17,369,442   17,015,559 
Premises and equipment, net  647,032   567,189 
Foreclosed assets  14,096   16,171 
Accrued interest receivable  85,545   81,968 
Bank owned life insurance (“BOLI”)  726,165   721,238 
Intangible assets, net  693,316   696,461 
Other, net  80,667   110,491 
Total assets $23,005,652  $22,388,030 
         
LIABILITIES AND STOCKHOLDERS EQUITY        
Deposits:        
Demand non-interest bearing $2,865,213  $2,748,273 
Savings and interest bearing transaction  9,874,987   9,682,713 
Time  5,736,668   5,507,429 
Total deposits  18,476,868   17,938,415 
Repurchase agreements with customers  25,517   20,564 
Other borrowings  1,489   96,692 
Subordinated notes  223,375   223,281 
Subordinated debentures  119,496   119,358 
Accrued interest payable and other liabilities  273,143   216,355 
Total liabilities  19,119,888   18,614,665 
         
Commitments and contingencies        
         
Stockholders’ equity:        
Preferred stock; $0.01 par value; 100,000,000 shares authorized; no shares issued or outstanding at March 31, 2019 or December 31, 2018      
Common stock; $0.01 par value; 300,000,000 shares authorized; 128,947,528 and 128,611,049 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively  1,289   1,286 
Additional paid-in capital  2,239,404   2,237,948 
Retained earnings  1,647,626   1,565,201 
Accumulated other comprehensive loss  (5,676)  (34,105)
Total stockholders’ equity before noncontrolling interest  3,882,643   3,770,330 
Noncontrolling interest  3,121   3,035 
Total stockholders’ equity  3,885,764   3,773,365 
Total liabilities and stockholders’ equity $23,005,652  $22,388,030 

 

Bank OZK
Consolidated Statements of Income
Unaudited

   Three Months Ended 
  March 31, 
  2019  2018 
       
  (Dollars in thousands, except per share amounts) 
Interest income:        
Non-purchased loans $245,864  $190,426 
Purchased loans  30,195   50,977 
Investment securities:        
Taxable  14,897   11,431 
Tax-exempt  3,873   4,160 
Deposits with banks and federal funds sold  414   498 
Total interest income  295,243   257,492 
         
Interest expense:        
Deposits  63,087   34,392 
Repurchase agreements with customers  22   159 
Other borrowings  1,389   633 
Subordinated notes  3,146   3,146 
Subordinated debentures  1,711   1,386 
Total interest expense  69,355   39,716 
         
Net interest income  225,888   217,776 
Provision for loan losses  6,681   5,567 
Net interest income after provision for loan losses  219,207   212,209 
         
Non-interest income:        
Service charges on deposit accounts  9,722   9,525 
Trust income  1,730   1,793 
BOLI income  5,162   7,580 
Other income from purchased loans  795   1,251 
Loan service, maintenance and other fees  4,874   4,743 
Net gains on investment securities     17 
Gains on sales of other assets  284   1,426 
Other  1,505   2,372 
Total non-interest income  24,072   28,707 
         
Non-interest expense:        
Salaries and employee benefits  44,868   45,499 
Net occupancy and equipment  14,750   14,150 
Other operating expenses  37,060   34,161 
Total non-interest expense  96,678   93,810 
         
Income before taxes  146,601   147,106 
Provision for income taxes  35,889   33,973 
Net income  110,712   113,133 
Earnings attributable to noncontrolling interest  (6)  11 
Net income available to common stockholders $110,706  $113,144 
         
Basic earnings per common share $0.86  $0.88 
         
Diluted earnings per common share $0.86  $0.88 
         
Dividends declared per common share $0.22  $0.19 

 

Bank OZK
Consolidated Statements of Stockholders’ Equity
Unaudited

   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, 2018 $1,286  $2,237,948  $1,565,201  $(34,105) $3,035  $3,773,365 
Net income        110,712         110,712 
Earnings attributable to noncontrolling interest        (6)     6    
Total other comprehensive income           28,429      28,429 
Common stock dividends paid, $0.22 per share        (28,281)        (28,281)
Noncontrolling interest cash contribution              80   80 
Issuance of 29,300 shares of common stock for exercise of stock options     387            387 
Issuance of 383,874 shares of unvested restricted common stock  4   (4)            
Repurchase and cancellation of 62,742 shares of common stock  (1)  (1,646)           (1,647)
Stock-based compensation expense     2,719            2,719 
Forfeiture of 13,953 shares of unvested restricted common stock                  
Balances – March 31, 2019 $1,289  $2,239,404  $1,647,626  $(5,676) $3,121  $3,885,764 
                         
Balances – December 31, 2017 $1,283  $2,221,844  $1,250,313  $(12,712) $3,060  $3,463,788 
Net income        113,133         113,133 
Earnings attributable to noncontrolling interest        11      (11)   
Total other comprehensive loss           (28,196)     (28,196)
Common stock dividends paid, $0.19 per share        (24,408)        (24,408)
Issuance of 200,025 shares of common stock for exercise of stock options  2   5,323            5,325 
Issuance of 198,268 shares of unvested restricted common stock  2   (2)            
Repurchase and cancellation of 70,931 shares of common stock  (1)  (3,729)           (3,730)
Stock-based compensation expense     3,742            3,742 
Forfeitures of 3,301 shares of unvested restricted common stock                  
Balances – March 31, 2018 $1,286  $2,227,178  $1,339,049  $(40,908) $3,049  $3,529,654 

 

Bank OZK
Summary of Non-Interest Expense
Unaudited

  Three Months Ended 
  March 31, 
  2019  2018 
    
  (Dollars in thousands) 
Salaries and employee benefits $44,868  $45,499 
Net occupancy and equipment  14,750   14,150 
Other operating expenses:        
Professional and outside services  8,564   8,705 
Software and data processing  4,709   3,340 
Deposit insurance and assessments  3,652   3,562 
Telecommunication services  3,344   3,197 
Travel and meals  2,669   2,153 
Postage and supplies  2,103   2,195 
Advertising and public relations  1,683   1,331 
ATM expense  987   1,363 
Loan collection and repossession expense  984   790 
Writedowns of foreclosed and other assets  562   151 
Amortization of intangibles  3,145   3,145 
Other  4,658   4,229 
Total non-interest expense $96,678  $93,810 

 

Bank OZK
Summary of Total Loans Outstanding
Unaudited

            
  March 31, 2019  December 31, 2018 
    
  (Dollars in thousands) 
Real estate:                
Residential 1-4 family $1,030,062   5.9% $1,049,460   6.1%
Non-farm/non-residential  4,196,446   24.0   4,319,388   25.2 
Construction/land development  6,719,940   38.4   6,562,185   38.4 
Agricultural  180,653   1.0   165,088   1.0 
Multifamily residential  1,357,890   7.8   1,116,026   6.5 
Total real estate  13,484,991   77.1   13,212,147   77.2 
Commercial and industrial  748,466   4.3   823,417   4.8 
Consumer  2,439,891   14.0   2,345,863   13.7 
Other  802,048   4.6   736,396   4.3 
Total loans $17,475,396   100.0% $17,117,823   100.0%

 

Summary of Deposits
Unaudited

       
  March 31, 2019  December 31, 2018 
    
  (Dollars in thousands) 
Non-interest bearing $2,865,213   15.5% $2,748,273   15.3%
Interest bearing:                
Transaction (NOW)  2,597,570   14.0   2,359,299   13.2 
Savings and money market  7,277,417   39.4   7,323,414   40.8 
Time deposits less than $100  2,524,138   13.7   2,297,101   12.8 
Time deposits of $100 or more  3,212,530   17.4   3,210,328   17.9 
Total deposits $18,476,868   100.0% $17,938,415   100.0%

 

Bank OZK
Selected Consolidated Financial Data
(Dollars in thousands, except per share amounts)
Unaudited

   Three Months Ended
March 31,
 
  2019  2018  % Change 
Income statement data:            
Net interest income $225,888  $217,776   3.7%
Provision for loan losses  6,681   5,567   20.0 
Non-interest income  24,072   28,707   (16.1)
Non-interest expense  96,678   93,810   3.1 
Net income available to common stockholders  110,706   113,144   (2.2)
Common stock data:            
Net income per share - diluted $0.86  $0.88   (2.3)%
Net income per share - basic  0.86   0.88   (2.3)
Cash dividends per share  0.22   0.19   15.8 
Book value per share  30.11   27.42   9.8 
Tangible book value per share (1)  24.73   21.93   12.8 
Diluted shares outstanding (thousands)  128,964   128,762     
End of period shares outstanding (thousands)  128,948   128,612     
Balance sheet data at period end:            
Total assets $23,005,652  $22,039,439   4.4%
Total loans  17,475,396   16,609,096   5.2 
Non-purchased loans  15,610,681   13,674,561   14.2 
Purchased loans  1,864,715   2,934,535   (36.5)
Allowance for loan losses  105,954   98,097   8.0 
Foreclosed assets  14,096   21,931   (35.7)
Investment securities  2,781,691   2,612,961   6.4 
Goodwill and other intangible assets  693,316   705,896   (1.8)
Deposits  18,476,868   17,833,672   3.6 
Repurchase agreements with customers  25,517   149,075   (82.9)
Other borrowings  1,489   1,942   (23.3)
Subordinated notes  223,375   222,993   0.2 
Subordinated debentures  119,496   118,938   0.5 
Unfunded balance of closed loans  11,544,218   12,551,032   (8.0)
Total common stockholders’ equity  3,882,643   3,526,605   10.1 
Net annualized losses on investment securities AFS included in common stockholders' equity  (5,676)  (40,908)    
Loan, including purchased loans, to deposit ratio  94.58%  93.13%    
Selected ratios:            
Return on average assets(2)  1.99%  2.16%    
Return on average common stockholders’ equity(2)  11.77   13.17     
Return on average tangible common stockholders’ equity(1) (2)  14.40   16.53     
Average common equity to total average assets  16.91   16.37     
Net interest margin – FTE(2)  4.53   4.69     
Efficiency ratio  38.49   37.88     
Net charge-offs to average non-purchased loans(2) (3)  0.05   0.04     
Net charge-offs to average total loans(2)  0.07   0.04     
Nonperforming loans to total loans(4)  0.22   0.09     
Nonperforming assets to total assets(4)  0.21   0.16     
Allowance for loan losses to non-purchased loans(5)  0.67   0.71     
Other information:            
Non-accrual loans(4) $33,405  $12,471     
Accruing loans - 90 days past due(4)          
Troubled and restructured non-purchased loans - accruing(4)  470        
Impaired purchased loans  16,695   6,849     

(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

  6/30/17  9/30/17  12/31/17  3/31/18  6/30/18  9/30/18  12/31/2018  3/31/2019 
Earnings Summary:                                
Net interest income $202,105  $209,722  $214,831  $217,776  $224,661  $220,614  $228,382  $225,888 
Federal tax (FTE) adjustment  3,396   3,014   2,450   1,166   1,151   1,132   1,219   1,207 
Net interest income (FTE)  205,501   212,736   217,281   218,942   225,812   221,746   229,601   227,095 
Provision for loan losses  (6,103)  (7,777)  (9,279)  (5,567)  (9,610)  (41,949)  (7,271)  (6,681)
Non-interest income  31,840   32,747   30,213   28,707   27,386   24,121   27,560   24,072 
Non-interest expense  (83,828)  (84,399)  (86,177)  (93,810)  (89,107)  (102,942)  (94,893)  (96,678)
Pretax income (FTE)  147,410   153,307   152,038   148,272   154,481   100,976   154,997   147,808 
FTE adjustment  (3,396)  (3,014)  (2,450)  (1,166)  (1,151)  (1,132)  (1,219)  (1,207)
Provision for income taxes  (53,488)  (54,246)  (3,434)  (33,973)  (38,589)  (25,665)  (38,750)  (35,889)
Noncontrolling interest  6   (40)  10   11   10   1   3   (6)
Net income available to common stockholders $90,532  $96,007  $146,164  $113,144  $114,751  $74,180  $115,031  $110,706 
Earnings per common share – diluted $0.73  $0.75  $1.14  $0.88  $0.89  $0.58  $0.89  $0.86 
Non-interest Income:                                
Service charges on deposit accounts $11,764  $9,729  $10,058  $9,525  $9,704  $9,730  $10,585  $9,722 
Trust income  1,577   1,755   1,729   1,793   1,591   1,730   1,821   1,730 
BOLI income  4,594   4,453   5,166   7,580   5,259   5,321   5,751   5,162 
Other income from purchased loans  4,777   2,933   2,009   1,251   2,744   1,418   2,370   795 
Loan service, maintenance and other fees  3,427   5,274   4,289   4,743   5,641   4,724   5,245   4,874 
Gains (losses) on sales of other assets  672   1,363   1,899   1,426   844   (518)  465   284 
Net gains on investment securities  404   2,429   1,201   17             
Other  4,625   4,811   3,862   2,372   1,603   1,716   1,323   1,505 
Total non-interest income $31,840  $32,747  $30,213  $28,707  $27,386  $24,121  $27,560  $24,072 
Non-interest Expense:                                
Salaries and employee benefits $39,892  $35,331  $38,417  $45,499  $41,665  $41,477  $41,837  $44,868 
Net occupancy expense  12,937   13,595   13,474   14,150   13,827   14,358   14,027   14,750 
Other operating expenses  30,999   35,473   34,286   34,161   33,615   47,107   39,029   37,060 
Total non-interest expense $83,828  $84,399  $86,177  $93,810  $89,107  $102,942  $94,893  $96,678 
Balance Sheet Data:                                
Total assets $20,064,589  $20,768,493  $21,275,647  $22,039,439  $22,220,380  $22,086,539  $22,388,030  $23,005,652 
Non-purchased loans  11,025,203   12,047,094   12,733,937   13,674,561   14,183,533   14,440,623   15,073,791   15,610,681 
Purchased loans  4,159,139   3,731,536   3,309,092   2,934,535   2,580,341   2,285,168   2,044,032   1,864,715 
Investment securities  2,101,751   1,975,102   2,622,796   2,612,961   2,617,859   2,706,156   2,888,281   2,781,691 
Deposits  16,241,440   16,823,359   17,192,345   17,833,672   17,897,085   17,822,915   17,938,415   18,476,868 
Unfunded balance of closed loans  11,883,679   12,519,839   13,192,439   12,551,032   11,999,661   11,891,247   11,364,975   11,544,218 
Common stockholders' equity  3,260,123   3,334,740   3,460,728   3,526,605   3,613,903   3,653,596   3,770,330   3,882,643 
Allowance for Loan Losses:                                
Balance at beginning of period $78,224  $82,320  $86,784  $94,120  $98,097  $104,638  $98,200  $102,264 
Net charge-offs  (2,007)  (3,313)  (1,943)  (1,590)  (3,069)  (48,387)  (3,207)  (2,991)
Provision for loan losses  6,103   7,777   9,279   5,567   9,610   41,949   7,271   6,681 
Balance at end of period $82,320  $86,784  $94,120  $98,097  $104,638  $98,200  $102,264  $105,954 
Selected Ratios:                                
Net interest margin – FTE(1)  4.99%  4.84%  4.72%  4.69%  4.66%  4.47%  4.55%  4.53%
Efficiency ratio  35.32   34.38   34.82   37.88   35.19   41.87   36.90   38.49 
Net charge-offs to average non-purchased loans(1) (2)  0.03   0.08   0.08   0.04   0.05   1.32   0.06   0.05 
Net charge-offs to average total loans(1)  0.05   0.09   0.05   0.04   0.07   1.14   0.07   0.07 
Nonperforming loans to total loans(3)  0.11   0.11   0.10   0.09   0.10   0.23   0.23   0.22 
Nonperforming assets to total assets(3)  0.23   0.20   0.18   0.16   0.15   0.23   0.23   0.21 
Allowance for loan losses to total non-purchased loans(4)  0.73   0.71   0.73   0.71   0.73   0.67   0.67   0.67 
Loans past due 30 days or more, including past due non-accrual loans, to total loans(3)  0.15   0.12   0.15   0.14   0.12   0.17   0.28   0.27 

(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 March 31, 
  2019  2018 
  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 $67,015  $414   2.50% $110,085  $498   1.83%
Investment securities:                        
Taxable  2,310,770   14,897   2.61   2,062,358   11,431   2.25 
Tax-exempt – FTE  515,613   4,903   3.86   556,776   5,265   3.84 
Non-purchased loans – FTE  15,482,768   246,041   6.44   13,010,093   190,487   5.94 
Purchased loans  1,947,783   30,195   6.29   3,181,740   50,977   6.50 
Total earning assets – FTE  20,323,949   296,450   5.92   18,921,052   258,658   5.54 
Non-interest earning assets  2,232,416           2,359,796         
Total assets $22,556,365          $21,280,848         
LIABILITIES AND STOCKHOLDERS EQUITY                        
Interest bearing liabilities:                        
Deposits:                        
Savings and interest bearing transaction $9,531,133  $36,103   1.54% $9,857,347  $22,570   0.93%
Time deposits of $100 or more  3,170,510   15,555   1.99   3,036,123   8,781   1.17 
Other time deposits  2,435,425   11,429   1.90   1,445,948   3,041   0.85 
Total interest bearing deposits  15,137,068   63,087   1.69   14,339,418   34,392   0.97 
Repurchase agreements with customers  22,192   22   0.40   112,434   159   0.57 
Other borrowings  269,588   1,389   2.09   165,943   633   1.55 
Subordinated notes  223,321   3,146   5.71   222,947   3,146   5.72 
Subordinated debentures  119,412   1,711   5.81   118,864   1,386   4.73 
Total interest bearing liabilities  15,771,581   69,355   1.78   14,959,606   39,716   1.08 
Non-interest bearing liabilities:                        
Non-interest bearing deposits  2,757,110           2,666,111         
Other non-interest bearing liabilities  210,588           167,778         
Total liabilities  18,739,279           17,793,495         
Common stockholders’ equity  3,813,979           3,484,297         
Noncontrolling interest  3,107           3,056         
Total liabilities and stockholders’ equity $22,556,365          $21,280,848         
Net interest income – FTE     $227,095          $218,942     
Net interest margin – FTE          4.53%          4.69%

 

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 
  March 31, 
  2019  2018 
    
  (Dollars in thousands) 
Net income available to common stockholders $110,706  $113,144 
Average common stockholders’ equity before noncontrolling interest $3,813,979  $3,484,297 
Less average intangible assets:        
Goodwill  (660,789)  (660,789)
Core deposit and other intangibles, net of accumulated amortization  (34,437)  (47,122)
Total average intangibles  (695,226)  (707,911)
Average tangible common stockholders’ equity $3,118,753  $2,776,386 
Return on average common stockholders’ equity(1)  11.77%  13.17%
Return on average tangible common stockholders’ equity(1)  14.40%  16.53%

(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

  March 31, 
  2019  2018 
    
  (In thousands, except per share amounts) 
Total common stockholders’ equity before noncontrolling interest $3,882,643  $3,526,605 
Less intangible assets:        
Goodwill  (660,789)  (660,789)
Core deposit and other intangible assets, net of accumulated amortization  (32,527)  (45,107)
Total intangibles  (693,316)  (705,896)
Total tangible common stockholders’ equity $3,189,327  $2,820,709 
Shares of common stock outstanding  128,948   128,612 
Book value per common share $30.11  $27.42 
Tangible book value per common share $24.73  $21.93 

 

Calculation of Total Tangible Common Stockholders’
Equity and the Ratio of Total Tangible Common
Stockholders’ Equity to Total Tangible Assets
Unaudited

  March 31, 
  2019  2018 
    
  (Dollars in thousands) 
Total common stockholders’ equity before noncontrolling interest $3,882,643  $3,526,605 
Less intangible assets:        
Goodwill  (660,789)  (660,789)
Core deposit and other intangible assets, net of accumulated amortization  (32,527)  (45,107)
Total intangibles  (693,316)  (705,896)
Total tangible common stockholders’ equity $3,189,327  $2,820,709 
Total assets $23,005,652  $22,039,439 
Less intangible assets:        
Goodwill  (660,789)  (660,789)
Core deposit and other intangible assets, net of accumulated amortization  (32,527)  (45,107)
Total intangibles  (693,316)  (705,896)
Total tangible assets $22,312,336  $21,333,543 
Ratio of total common stockholders’ equity to total assets  16.88%  16.00%
Ratio of total tangible common stockholders’ equity to total tangible assets  14.29%  13.22%

Media Contact: Susan Blair (501) 978-2217
Investor Contact: Tim Hicks (501) 978-2336

 

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