Earnings jump 361% for Bank of the Ozarks
by July 13, 2011 5:44 pm 66 views
Little Rock-based Bank of the Ozarks announced Wednesday (July 13) record second quarter earnings of $50.2 million, a 361% increase from the 2010 period that comes courtesy of revenue from bank acquisitions completed in the second quarter.
On April 29, 2011, the bank entered into agreements with the Federal Deposit Insurance Corp. (FDIC) to acquire First Choice Community Bank and Park Avenue Bank. Both banks, based in Georgia, contributed $36.4 million — after tax and net of acquisition and conversion costs — to the second quarter income. The two banks were the sixth and seventh FDIC-assisted acquisitions for Bank of the Ozarks.
The acquisitions boosted per share earnings to $2.91, well above analyst estimates of 78 cents per share.
“We are very pleased to report our record second quarter results. Highlights of the quarter included two more strategic and profitable acquisitions, record net interest income, our best quarterly net interest margin as a public company, record service charge income, favorable asset quality and significant growth in our capital accounts,” George Gleason, chairman and CEO, said in the earnings report.
Net income for the first half of 2011 totaled $64.847 million, up 141.6% compared to the same period in 2010. The gains also reflect a FDIC-assisted bank purchase — Oglethorpe Bank in Georgia, during the first quarter of 2011.
Reflecting the acquisitions, bank assets at the end of June 30 totaled $4.026 billion, up 39.9% compared to the 2010 period.
As he has in past earnings reports, Gleason said the financial gains from bank acquisitions will likely be used for future bank purchases.
“In recent years our strong earnings have resulted in accumulation of significant capital,” Gleason said in the statement. “We believe we will have numerous opportunities over the next several years, including opportunities for additional FDIC-assisted acquisitions, to profitably deploy this accumulated capital.”
The bank has managed to avoid gains in bad loans during the acquisition process. For the first six months of 2010, the bank;s provision for loan and lease losses was $6 million, down from the $7.6 million for the first six months of 2010.
Shares of Bank of the Ozarks (NASDAQ: OZRK) closed Wednesday at $53.20, up $1.22. The earnings were released after the markets closed. During the past 52 weeks, the share price has ranged from a $55.42 high to a $34.75 low.