Bank of the Ozarks gets Federal Reserve approval on acquisitions to expand southern reach

Bank of the Ozarks Inc. said today (June 29) it received final regulatory approval from the Federal Reserve for its previously announced merger transactions with St. Petersburg, Fla.-based C1 Financial, Inc. and Community & Southern Holdings Inc. of Atlanta.

On May 13, the fast-growing Little Rock-based regional bank said it had obtained regulatory approval from the Federal Deposit Insurance Corporation and the Arkansas State Bank Department of the two blockbuster deals.

All required regulatory approvals with respect to the C1 and Community & Southern Bank (C&S) mergers have now been received, bank officials said. The Arkansas bank, which has total assets of $11.4 billion at the end of the first quarter, said it anticipates closing the C&S transaction on or about July 20, 2016. The C1 transaction is expected to close a day later on or about July 21, 2016, subject to customary closing conditions for each transaction.

Bank of the Ozarks first announced on Oct. 19 an all-stock pact and plan of merger to acquire Atlanta-based Community & Southern and its wholly-owned bank subsidiary, Community & Southern Bank, in a deal valued at nearly $800 million, or approximately $20.50 per fully diluted CSB share. At Sept. 30, 2015, C&S had approximately $4.4 billion of total assets, $3 billion of loans and $3.7 billion of deposits.

Following that deal, Bank of the Ozarks announced Nov. 16 it would expand its southern U.S. reach and acquire St. Petersburg, Fla.-based C1 Financial in an all-stock transaction valued at $402.5 million. C1 operates 32 Florida banking offices on the west coast of Florida and in Miami-Dade and Orange counties. The majority of the offices are located in Florida’s top six metropolitan markets. At September 30, 2015, C1 had approximately $1.7 billion of total assets, $1.4 billion of loans and $1.3 billion of deposits.

In Wednesday’s midday session, Bank of the Ozarks shares (NASDAQ: OZRK) were up 1.7%, or 61 cents at $36.56. Shares in the Bank of the Ozark have regained their footing over the past two days after Arkansas and U.S. bank stocks got hammered in the market downdraft following the United Kingdom’s decision to exit the European Commission.

The Arkansas bank’ stock also took a big hit in early May after the Muddy Waters investment research firm revealed it has a huge short position against the fast-growing Little Rock banking group, causing shares to drop nearly 15%.

Still, the closing of the two southern deals will propel Bank of the Ozark well over the $10 billion asset mark, the crucial milestone established by the Dodd-Frank Act as the regulatory threshold between super-community banks and larger regional banking groups. Bank of the Ozarks officials have also announced plans to build a new corporate headquarters in west Little Rock to keep pace with its rapid growth.