Surprise assessment, Texas probe buck Home BancShares Q4

Central ArkansasFinanceLatest NewsNortheast Arkansas

by Roby Brock ([email protected]) January 18, 2024 8:04 am 487 views 

Home BancShares, parent company of Centennial Bank, reported strong results for the year, but the fourth quarter saw a surprise FDIC assessment and potential legal trouble in a West Texas portion of its business.

For the 2023 fourth quarter, Conway-based Home BancShares posted net income of $86.2 million compared to $115.7 million one year ago. Diluted earnings per share was 51 cents versus 57 cents in the previous year’s fourth quarter.

Revenue in the fourth quarter of 2023 was $245.6 million compared to $272.3 million in the 2022 fourth quarter.

For the full year of 2023, Home BancShares reported adjusted net income of $398.47 million versus $375.94 million in 2022. Full year diluted earnings per share was $1.97 versus $1.93.

“2023 was a tough year for the banking sector. For HOMB, the biggest obstacles came in the form of the loss of income as a result of the actions from some individuals in West Texas that may prove to be unethical and potentially criminal,” said John Allison, Chairman and CEO of Home Bancshares, without alluding to additional details.

“In addition, the FDIC fourth quarter surprise assessment to financial institutions to recover losses from failed banks, resulted in $13 million ($0.05 per share) expense for Home BancShares. Both of these events were out of HOMB’s control, and the first event is a matter for the court, so we won’t speculate on the damage. The second one we know is $0.05 per share. Excluding these events, I’m proud to say that we would have beat our goal of $400 million plus and earned over $2.00 per share,” Allison added.

Other financial highlights include:

  • Net interest income on a fully taxable equivalent basis was $203.9 million for the three-month period ended Dec. 31, 2023, and $203.2 million for the three-month period ended Sept. 30, 2023.
  • Non-interest income was $42.8 million for the fourth quarter of 2023.
  • Total loans receivable were $14.42 billion at Dec. 31, 2023, compared to $14.27 billion at Sept. 30, 2023.
  • Total deposits were $16.79 billion at Dec. 31, 2023, compared to $16.52 billion at Sept. 30, 2023.
  • Total assets were $22.66 billion at Dec. 31, 2023, compared to $21.95 billion at Sept. 30, 2023.

Shares of Home Bancshares closed Wednesday at $23.09. The company’s stock has traded in a 52-week range of $19.61 and $25.80 per share.

The financial institution has 76 branches in Arkansas, 78 branches in Florida, 63 branches in Texas, 5 branches in Alabama and one branch in New York City.