Bank Of The Ozarks Beats Expectations, 2Q Earnings Up 53% From Year Ago

Bank of the Ozarks easily beat year ago results and met Wall Street expectations by reporting second quarter earnings of 52 cents a share, up 53% from 34 cents a year ago, the company announced after the close of market on Monday.

For the quarter ended June 30, the Little Rock regional bank reported net income of $44.8 million, a 69.1% increase from $26.5 million for the second quarter of 2014. The bank’s financial results included $4.8 million from tax-exempt income insurance benefits and sales of investment securities, which were partially offset by $4.5 million for prepayment penalties related to a federal loan advance and administrative expenses. Those one-time items, however, only added a penny to the company’s quarterly earnings results, bank officials said.

With those adjustments, the Arkansas bank reported second quarter earnings of 52 cents per share on revenues $117 million. Wall Street analysts had expected the fast-growing Arkansas holding bank to report quarterly earnings of 51 cents per share, according to Thomson Reuters.

“We are very pleased with our excellent second quarter results, including our $456 million of growth in non-purchased loans and leases, growth of $596 million in the unfunded balance of closed loans, efficiency ratio of 36.6%, net interest margin of 5.37% and excellent asset quality,” Chairman and CEO George Gleason said in a statement. “Our annualized return on average assets of 2.17% during the quarter builds on our track record of having achieved returns on average assets in excess of 2.00% in each of the last five years.”

Additional financial highlights from the quarter included:

· Total deposits were $7.09 billion at June 30, 2015, a 42.2% increase from $4.98 billion at June 30, 2014.
· Total assets were $8.71 billion at June 30, 2015, a 38.3% increase from $6.30 billion at June 30, 2014.
· Common stockholders’ equity was $1.21 billion at June 30, 2015, a 42.2% increase from $850 million at June 30, 2014.
· Including purchased loans, total loans and leases were $6.59 billion at June 30, 2015, a 44.1% increase from $4.58 billion at June 30, 2014.
· Net interest income for the second quarter of 2015 was a record $93.8 million, a 44.7% increase from $64.8 million for the second quarter of 2014.
· Mortgage lending income increased 57.4% to $1.77 million in the second quarter of 2015 compared to $1.13 million in the second quarter of 2014.

During the second quarter, the Little Rock-based financial holding company joined the Standard & Poor’s MidCap 400 and acquired the Bank of the Carolinas Corp. in early May in an all-stock deal worth $65 million – its thirteenth acquisition since March 2010.

Following the takeover of the small North Carolina bank’s eight offices between Charlotte and Winston-Salem, the fast-growing Arkansas bank’s portfolio will include 24 banking locations in that state.

At the close of trading Monday, Bank of the Ozarks’ shares closed at $46.29, up 57 cents at 1.2% as more than 8000,000 shares traded hands. The bank has traded in the range of $19.14 and $48.68 during the past 52 weeks.