Bear State first quarter profits hit $3.3 million, consolidating Missouri bank into operations

Quarterly profits for Bear State Financial Inc. rose slightly from a year ago as the Little Rock community bank begins the consolidation of companywide operations following the acquisition of Metropolitan National Bank in Springfield, Mo., last year.

For the period ended March 31, the former First Federal Bank of Harrison reported earnings of $3.3 million, or nine cents per share, compared to $2.3 million, or seven cents per share, in the first quarter of 2015. The Arkansas bank saw revenue of $20.6 million for the quarterly period.

“Our first quarter results continue to highlight the strengths of Bear State – disciplined growth, operational efficiency, and the ability to acquire and integrate,” said Bear State President and CEO Mark McFatridge. “Only eight months after announcing the acquisition, we successfully completed the charter consolidation and systems integration of Metropolitan National Bank during the quarter.”

According to bank officials, the bank consolidated the Metropolitan National Bank into the Bear State Bank charter and converted MNB’s systems to the bank’s core technology platform on Feb. 22.

McFatridge said the bank began experiencing significant operational and organizational improvements as a result of the charter consolidation and systems conversion, the benefits of which are expected to be realized in the second quarter of 2016. In addition, the Arkansas community bank intends to consolidate six locations, or 11% of the branch network, by the end of April. It has notified all customers affected by these consolidations, and will be automatically transferring customer accounts to the next most convenient location.

“Our previously announced closure of 11% of our branch network will be completed during the second quarter. This initiative will improve operational efficiencies and reduce market overlaps. Additionally, our teammates continue to do a tremendous job in uncovering lending opportunities,” said McFatridge, who was named CEO after the MNB acquisition in October. “While many of these opportunities are with creditworthy borrowers that we would love to bank, the competitive banking environment in which we operate is dictating terms that fall outside of our disciplined risk culture.”

Following are key Bear State highlights for the first quarter.
Total assets were $1.92 billion in the first quarter, a 30% increase compared to $1.48 billion a year ago Total deposits were $1.61 billion at March 31, 2016, a 30% increase compared to $1.24 billion in same period of 2015. The increase in assets and deposits was primarily due to the MNB acquisition on October 1, 2015, bank officials said.

First quarter loans grew to $1.46 billion in the three-month period, an increase of $418 million, or 40% compared to the March 31, 2015.

Total stockholders’ equity was $224 million at March 31, 2016, a 29% increase from $173 million at March 31, 2015. Tangible common stockholders’ equity in the first quarter was $172 million, a 23% increase from $140 million a year ago.

At the end of Wednesday’s session on the NASDAQ stock exchange, Bear shares were up three cents at $9.48 in thin trading. The Arkansas bank’s shares have traded in the range of $7.61 and $11.39 over the past 52 weeks.