Arvest Closes $500M in 1Q Mortgage Apps; BOZ Posts Record Profit (Industry notes)

Arvest Mortgage Co. closed a record $500 million in mortgages during the first quarter. The company closed $1.04 billion total mortgages during calendar 2008.

Mortgages include those made at all Arvest Bank offices in Arkansas, Oklahoma, Missouri and Kansas.

Todd White, senior vice president of Arvest Mortgage Co., said a number of factors contributed to the boon, including low interest rates, the $8,000 first-time homebuyer tax credit and the fact that Arvest maintains servicing on all of its mortgages.

“The housing market seems to be getting its feet under it again and it seems to be spurred on by the tax credit,” White said.

At the beginning of the quarter, the bank was mostly refinancing mortgages for homeowners with about 20 percent of the volume being new home purchases. As the quarter wore on and into April, the trend is at about “40 to 50 percent” new purchases with the rest being refinances, he said.

“We’re poised to continue that trend,” White said. “We assume the second quarter will be very good as well.”

Arvest was the No. 1 lender on the Northwest Arkansas Business Journal’s annual list of largest mortgage lenders published in November with 7,244 total loans closed during 2007, down from 8,461 closed in 2006.

Priority Bank Tops ROA List
Priority Bank of Ozark topped the list of banks doing business in Northwest Arkansas in terms of return on assets.

The two-office thrift closed December with an ROA of 2.17 percent, handily beating out the No. 2 bank, Citizens’ Bank & Trust Co. of Van Buren, with a 1.5 percent ROA.

The Northwest Arkansas Business Journal compiles an annual list of all banks doing business in Benton, Carroll, Crawford, Sebastian, Madison and Washington counties. It starts on Page 20.

At the end of 2007, The First National Bank of Fort Smith was the No. 1 bank in the six-county market in terms of ROA, with a 1.83 percent. FNBFS is operated by the same holding company as Citizens’, First Bank Corp. of Fort Smith.

According to the Federal Deposit Insurance Corp., the median return on assets for Arkansas-chartered banks at the end of 2008 was 0.83 percent. Ten of the 28 private banks on the list were at or above that mark.

Priority ended 2007 with an ROA of 1.61 percent, coming in at No. 4 on the list.

Arvest to Close Branch in Mall
Arvest Bank-Fayetteville will close its branch located at 4201 N. Shiloh Rd., inside the Northwest Arkansas Mall on May 30.

A spokesman for the bank said the closing isn’t a reactionary move to reduce expenses as much as it is reallocating the bank’s resources so customers are better served. There are three other Arvest offices within a mile of the branch in the mall.

Donny Story, president of Arvest’s Fayetteville market, said that no employees will lose their jobs, that they all have slots at existing Arvest offices.

The bank recently opened the first “green” office on Joyce Boulevard, a relocation of another branch just up the road. The new office is about 8,500 SF.

Story noted the bank has plans for new buildings in both Fayetteville and Springdale, though a ground-breaking date has not been set for the Fayetteville location. That will eventually be a relocation of a branch near Green Acres on College Avenue to the intersection of College Avenue and Township Road.

The mall office had $7 million in deposits as of June 30, whereas the old location on Joyce Boulevard had $94 million.

In February Parkway Bank of Rogers closed two branches and Bank of America will soon close its branch at 1500 N. College Ave. in Fayetteville, along with four other offices in central Arkansas.

As of June 30, there were 203 bank offices doing business in Benton and Washington counties.

BOZ Earns $9.3M in 1Q
Bank of the Ozarks Inc. of Little Rock posted record net income in the first quarter of $9.3 million or 55 cents a share, up 20 percent over the $7.8 million or 46 cents a share for the first quarter of 2008.

Analysts had expected earnings of 52 cents per share.

The company’s returns on average assets and average common stockholders’ equity for the first quarter of 2009 were 1.16 percent and 14.19 percent, respectively, compared to 1.11 percent and 15.31 percent, respectively, for the first quarter of 2008.

Loans and leases were up slightly to $1.99 billion at the end of March, while deposits were up 4.1 percent to $2.29 billion.

Total assets were $3.16 billion as the quarter ended, a 3.5 percent increase over the year-ago figure.

All of those figures, however, were down from 2008 year-end numbers.

Loans and leases were down 1.5 percent compared to $2.02 billion as of Dec. 31.

Deposits were off 2.2 percent compared to $2.34 billion and total assets declined 2.3 percent from $3.23 billion at year’s end.

“In the past two quarters, our total loans and leases have declined modestly as slowing economic conditions have diminished loan and lease demand,” George Gleason, chairman and CEO, said. “While we are actively seeking and originating many good quality new loans and leases, the volume of new loans and leases has not kept pace with pay downs.

“During the quarter just ended, we reduced our brokered deposits by $128 million while increasing local deposits by $77 million. As a result, total deposits declined $51 million.”

Pulaski to Rebranded As IberiaBank FSB
The name of Pulaski Bank & Trust, a part of the Little Rock landscape since 1973, is being changed to IberiaBank FSB by its holding company, IberiaBank Corp. of Lafayette, La.

The company, which entered Arkansas two years ago, is taking advantage of favorable national publicity generated by its status as the first banking company to return federal bailout money, Beth Ardoin said.

IberiaBank Corp. currently has two charters: IberiaBank of Lafayette, a bank charter with 50 branches in Louisiana and 3.86 billion in assets, and Pulaski Bank & Trust, a thrift charter.

IberiaBank will keep the separate charters even after Pulaski is renamed IberiaBank FSB, Ardoin said.

FSB is an abbreviation for federal savings bank, another name for a federally chartered thrift or savings and loan association.

IberiaBank closed on the purchase of Pocahontas Bancorp Inc. of Jonesboro, the holding company for First Community Bank, and Pulaski Investment Corp., the holding company for Pulaski Bank & Trust in Little Rock in February 2007.

IberiaBank Corp. then merged the two institutions, using the First Community thrift charter and the Pulaski Bank name.

Pulaski Bank then expanded into northwest Arkansas in May when it purchased insured deposits and eight branches from the Federal Deposit Insurance Corp., receiver for failed ANB Financial of Bentonville.

Pulaski Bank had long operated a couple of branches in the Memphis area, but last month IberiaBank Corp. took advantage of the unfettered branching privileges of a thrift to open a loan production office in Mobile, Ala. That office will become a full-service branch, according to Friday’s announcement, and a branch is also being opened in Houston.

While acknowledging that the IberiaBank name has little currency in Arkansas, Ardoin said the Pulaski name was similarly handicapped outside central Arkansas.

Meanwhile, the company was the first to announce that it had changed its mind on accepting an investment by the Treasury Department under the Troubled Asset Relief Program and was the first to actually do so.

National publicity ensued, including an appearance on CBS News by Chairman William Fenstermaker.

Pulaski Heights Bank was chartered in Little Rock in 1956 and renamed Pulaski Bank & Trust Co. in 1973.