Press Release

Bank OZK Announces Third Quarter 2018 Earnings

Company Release - 10/18/2018 4:01 PM ET

LITTLE ROCK, Ark.--(BUSINESS WIRE)-- Bank OZK (the “Bank”) (Nasdaq: OZK) today announced that net income for the third quarter of 2018 was $74.2 million, a 22.7% decrease from the third quarter of 2017. Diluted earnings per common share for the third quarter of 2018 were $0.58, a 22.7% decrease from the third quarter of 2017.

On July 16, 2018, the Bank changed its name to Bank OZK, changed its ticker symbol to “OZK,” and adopted a new logo and signage, all as part of a strategic rebranding. As a result of this name change and strategic rebranding, the Bank incurred pretax expenses of $10.8 million during the third quarter and $11.4 million for the first nine months of 2018.

During the third quarter of 2018, the Bank incurred combined charge-offs of $45.5 million on two Real Estate Specialties Group (“RESG”) credits. These two unrelated projects are in South Carolina and North Carolina, have been in the Bank’s portfolio since 2007 and 2008, and were previously classified as substandard. The combined balance of these credits, after the charge-offs, is $20.6 million.

For the nine months ended September 30, 2018, net income totaled $302.1 million, a 9.6% increase from the first nine months of 2017. Diluted earnings per common share for the first nine months of 2018 were $2.35, a 6.3% increase from the first nine months of 2017.

The Bank’s annualized returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the third quarter of 2018 were 1.33%, 8.07% and 9.99%, respectively, compared to 1.89%, 11.56% and 14.76%, respectively, for the third quarter of 2017. The Bank’s annualized returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the first nine months of 2018 were 1.85%, 11.32% and 14.11%, respectively, compared to 1.91%, 12.10% and 15.81%, respectively, for the first nine months of 2017. The calculation of the Bank’s return on average tangible common stockholders’ equity and the reconciliation to generally accepted accounting principles (“GAAP”) are included in the schedules accompanying this release.

George Gleason, Chairman and Chief Executive Officer, stated, “While our third quarter results did not meet our usual high standards for performance, we are very pleased with the continued enhancement of our team, technology and business capabilities. RESG continues to be a national leader in commercial real estate finance. Our indirect RV and Marine lending business continues to grow as another exceptional national lending platform. Many of the businesses in our community bank group are successfully growing, with the expectation that some of these units may ultimately achieve national scale. Our focus is solidly on our future, and we believe we are prepared to accomplish more than ever before.”

KEY BALANCE SHEET METRICS

Total loans, including purchased loans, were $16.73 billion at September 30, 2018, a 6.0% increase from $15.78 billion at September 30, 2017. Non-purchased loans, which exclude loans acquired in previous acquisitions, were $14.44 billion at September 30, 2018, a 19.9% increase from $12.05 billion at September 30, 2017. Purchased loans, which consist of loans acquired in previous acquisitions, were $2.29 billion at September 30, 2018, a 38.8% decrease from $3.73 billion at September 30, 2017. The unfunded balance of closed loans totaled $11.89 billion at September 30, 2018, a 5.0% decrease from $12.52 billion at September 30, 2017.

Deposits were $17.82 billion at September 30, 2018, a 5.9% increase from $16.82 billion at September 30, 2017, but a 0.4% decrease from $17.90 billion at June 30, 2018. Total assets were $22.09 billion at September 30, 2018, a 6.3% increase from $20.77 billion at September 30, 2017, but a 0.6% decrease from $22.22 billion at June 30, 2018.

Common stockholders’ equity was $3.65 billion at September 30, 2018, a 9.6% increase from $3.33 billion at September 30, 2017. Tangible common stockholders’ equity was $2.95 billion at September 30, 2018, a 12.6% increase from $2.62 billion at September 30, 2017. Book value per common share was $28.41 at September 30, 2018, a 9.2% increase from $26.02 at September 30, 2017. Tangible book value per common share was $22.97 at September 30, 2018, a 12.3% increase from $20.46 at September 30, 2017. The calculations of the Bank’s tangible common stockholders’ equity and tangible book value per common share and the reconciliations to GAAP are included in the schedules accompanying this release.

The Bank’s ratio of total common stockholders’ equity to total assets was 16.54% at September 30, 2018 compared to 16.06% at September 30, 2017. Its ratio of total tangible common stockholders’ equity to total tangible assets was 13.81% at September 30, 2018 compared to 13.08% at September 30, 2017. The calculation of the Bank’s ratio of total tangible common stockholders’ equity to total tangible assets and the reconciliation to GAAP are included in the schedules accompanying this release.

NET INTEREST INCOME

Net interest income for the third quarter of 2018 was $220.6 million, a 5.2% increase from $209.7 million for the third quarter of 2017, but a 1.8% decrease from $224.7 million for the second quarter of 2018. Net interest margin, on a fully taxable equivalent (“FTE”) basis, was 4.47% for the third quarter of 2018, a decrease of 37 basis points from 4.84% for the third quarter of 2017. Average earning assets were $19.69 billion for the third quarter of 2018, a 12.9% increase from $17.44 billion for the third quarter of 2017.

Net interest income for the first nine months of 2018 was $663.1 million, a 10.0% increase from $602.6 million for the first nine months of 2017. Net interest margin, on a FTE basis, was 4.60% for the first nine months of 2018, a decrease of 30 basis points from 4.90% for the first nine months of 2017. Average earning assets were $19.35 billion for the first nine months of 2018, a 15.8% increase from $16.72 billion for the first nine months of 2017.

NON-INTEREST INCOME

Non-interest income for the third quarter of 2018 decreased 26.3% to $24.1 million compared to $32.7 million for the third quarter of 2017. Non-interest income for the first nine months of 2018 decreased 14.3% to $80.2 million compared to $93.6 million for the first nine months of 2017.

The Bank’s service charges on deposit accounts declined from $32.8 million for the first nine months of 2017 to $29.0 million for the first nine months of 2018 primarily due to the Durbin Amendment’s impact on the Bank’s interchange revenue effective as of July 1, 2017. The Bank’s mortgage lending income declined from $1.6 million for the third quarter and $5.1 million in the first nine months of 2017 to essentially none for the third quarter and $0.5 million in the first nine months of 2018. This was a result of the Bank’s decision in December 2017 to exit the secondary market mortgage lending business and the wind down of that business in the first half of 2018. The Bank had essentially no net gains on investment securities during the third quarter and the first nine months of 2018 compared to net gains totaling $2.4 million for the third quarter and $2.8 million for the first nine months of 2017. Net gains (losses) on sales of other assets were a net loss of $0.5 million for the third quarter and a net gain of $1.8 million for the first nine months of 2018 compared to net gains of $1.4 million for the third quarter and $3.7 million for the first nine months of 2017.

NON-INTEREST EXPENSE

Non-interest expense for the third quarter of 2018 increased 22.0% to $102.9 million compared to $84.4 million for the third quarter of 2017. Non-interest expense for the first nine months of 2018 increased 16.0% to $285.9 million compared to $246.5 million for the first nine months of 2017. Non-interest expense included $10.8 million for the third quarter and $11.4 million for the first nine months of 2018 (none in 2017) related to the name change that was effective on July 16, 2018 and the related strategic rebranding.

The Bank’s efficiency ratio (non-interest expense divided by the sum of net interest income FTE and non-interest income) for the third quarter of 2018 was 41.9% compared to 34.4% for the third quarter of 2017. The Bank’s efficiency ratio for the first nine months of 2018 was 38.3% compared to 34.9% for the first nine months of 2017.

ASSET QUALITY, CHARGE-OFFS, PROVISIONS AND ALLOWANCE

Excluding purchased loans, the Bank’s ratio of nonperforming loans as a percent of total loans was 0.23% at September 30, 2018 compared to 0.11% at September 30, 2017, and its ratio of nonperforming assets as a percent of total assets was 0.23% at September 30, 2018 compared to 0.20% at September 30, 2017.

Excluding purchased loans, the Bank’s ratio of loans past due 30 days or more, including past due non-accrual loans, to total loans was 0.17% at September 30, 2018 compared to 0.12% at September 30, 2017.

The Bank’s annualized net charge-off ratio for non-purchased loans was 1.32% for the third quarter of 2018 compared to 0.08% for the third quarter of 2017, and it was 0.49% for the first nine months of 2018 compared to 0.06% for the first nine months of 2017. The Bank’s annualized net charge-off ratio for all loans was 1.14% for the third quarter of 2018 compared to 0.09% for the third quarter of 2017, and it was 0.43% for the first nine months of 2018 compared to 0.08% for the first nine months of 2017.

The Bank’s provision for loan losses totaled $41.9 million for the third quarter and $57.1 million for the first nine months of 2018 compared to $7.8 million for the third quarter and $18.8 million for the first nine months of 2017. The increase in the Bank’s provision expense for the third quarter and the first nine months of 2018 was primarily due to the charge-offs on the two RESG credits and the associated recalibration of the allowance for loan losses.

The Bank’s allowance for loan losses for its non-purchased loans was $96.6 million, or 0.67% of total non-purchased loans, at September 30, 2018 compared to $85.2 million, or 0.71% of total non-purchased loans, at September 30, 2017. The Bank had $1.6 million of allowance for loan losses for its purchased loans at both September 30, 2018 and 2017.

MANAGEMENT’S COMMENTS, CONFERENCE CALL, TRANSCRIPT AND FILINGS

In connection with this release, the Bank released management’s comments on the results for the quarter just ended. Management will conduct a conference call to take questions on these quarterly results and management’s comments at 10:00 a.m. CT (11:00 a.m. ET) on Friday, October 19, 2018. Interested parties may listen to this call by dialing 1-844-818-5110 (U.S. and Canada) or 210-229-8841 (internationally) and asking for the Bank OZK conference call. A recorded playback of the call will be available for one week following the call at 1-855-859-2056 (U.S. and Canada) or 404-537-3406 (internationally). The passcode for this playback is 7672039. The call will be available live or in a recorded version on the Bank’s Investor Relations website at ir.ozk.com under “Company News/Webcasts.” The Bank will also provide a transcript of the conference call on its Investor Relations website.

The Bank files annual, quarterly and current reports, proxy materials and other information required by the Securities Exchange Act of 1934 with the Federal Deposit Insurance Corporation (“FDIC”), copies of which are available electronically at the FDIC’s website at https://efr.fdic.gov/fcxweb/efr/index.html and are also available on the Bank’s Investor Relations website at http://ir.ozk.com.

NON-GAAP FINANCIAL MEASURES

This release contains certain non-GAAP financial measures. The Bank uses these non-GAAP financial measures, specifically return on average tangible common stockholders’ equity, tangible book value per common share, total tangible common stockholders’ equity and the ratio of total tangible common stockholders’ equity to total tangible assets, as important measures of the strength of its capital and its ability to generate earnings on its tangible capital invested by its shareholders. These measures typically adjust GAAP financial measures to exclude intangible assets. Management believes presentation of these non-GAAP financial measures provides useful supplemental information which contributes to a proper understanding of the financial results and capital levels of the Bank. These non-GAAP disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other banks. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the tables at the end of this release under the caption “Reconciliation of Non-GAAP Financial Measures.”

FORWARD-LOOKING STATEMENTS

This release and other communications by the Bank include certain “forward-looking statements” regarding the Bank’s plans, expectations, thoughts, beliefs, estimates, goals and outlook for the future that are intended to be covered by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on management’s expectations as well as certain assumptions and estimates made by, and information available to, management at the time. Those statements are not guarantees of future results or performance and are subject to certain known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those expressed in, or implied by, such forward-looking statements. These risks, uncertainties and other factors include, but are not limited to: potential delays or other problems implementing the Bank’s growth, expansion and acquisition strategies including delays in identifying sites, hiring or retaining qualified personnel, obtaining regulatory or other approvals, obtaining permits and designing, constructing and opening new offices; the ability to enter into and/or close additional acquisitions; problems with, or additional expenses relating to, integrating acquisitions; the inability to realize expected cost savings and/or synergies from acquisitions; problems with managing acquisitions; the effect of the announcements of any future acquisition on customer relationships and operating results; the availability of and access to capital; possible downgrades in the Bank’s credit ratings or outlook which could increase the costs or availability of funding from capital markets; the ability to attract new or retain existing or acquired deposits or to retain or grow loans, including growth from unfunded closed loans; the ability to generate future revenue growth or to control future growth in non-interest expense; interest rate fluctuations, including changes in the yield curve between short-term and long-term interest rates or changes in the relative relationships of various interest rate indices; competitive factors and pricing pressures, including their effect on the Bank’s net interest margin or core spread; general economic, unemployment, credit market and real estate market conditions, and the effect of such conditions on the creditworthiness of borrowers, collateral values, the value of investment securities and asset recovery values; failure to receive approval of the Bank’s pending application for change in accounting methods with the Internal Revenue Service; changes in legal, financial and/or regulatory requirements; recently enacted and potential legislation and regulatory actions, including changes expected to result from the Tax Cuts and Jobs Act and the Economic Growth, Regulatory Relief and Consumer Protection Act and the costs and expenses to comply with new and/or existing legislation and regulatory actions; changes in U.S. government monetary and fiscal policy; future FDIC special assessments or changes to regular assessments; the ability to keep pace with technological changes, including changes regarding maintaining cybersecurity; the impact of failure in, or breach of, our operational or security systems or infrastructure, or those of third parties with whom we do business, including as a result of cyber-attacks or an increase in the incidence or severity of fraud, illegal payments, security breaches or other illegal acts impacting the Bank or its customers; adoption of new accounting standards or changes in existing standards; and adverse results (including costs, fines, reputational harm and/or other negative effects) from current or future litigation, regulatory examinations or other legal and/or regulatory actions or rulings as well as other factors identified in this press release or as detailed from time to time in the Bank’s public filings, including those factors included in the disclosures under the headings “Forward-Looking Information” and “Item 1A. Risk Factors” in the Bank’s most recent Annual Report on Form 10-K for the year ended December 31, 2017 and its quarterly reports on Form 10-Q. Should one or more of the foregoing risks materialize, or should underlying assumptions prove incorrect, actual results or outcomes may vary materially from those projected in, or implied by, such forward-looking statements. The Bank disclaims any obligation to update or revise any forward-looking statements based on the occurrence of future events, the receipt of new information or otherwise.

GENERAL INFORMATION

Bank OZK (Nasdaq: OZK) is a regional bank providing innovative financial solutions delivered by expert bankers with a relentless pursuit of excellence. Bank OZK has been recognized as the #1 bank in the nation in its asset size for eight consecutive years. Headquartered in Little Rock, Arkansas, Bank OZK conducts operations through 251 offices in Arkansas, Georgia, Florida, North Carolina, Texas, Alabama, South Carolina, California, New York and Mississippi. Bank OZK can be found at www.ozk.com and on Facebook, Twitter and LinkedIn or contacted at (501) 978-2265 or P.O. Box 8811, Little Rock, Arkansas 72231-8811.

   

Bank OZK

Consolidated Balance Sheets

Unaudited

 
September 30, December 31,
2018 2017
(Dollars in thousands, except per share amounts)
ASSETS
Cash and cash equivalents $ 387,766 $ 440,388
Investment securities - available for sale 2,669,877 2,593,873
Federal Home Loan Bank of Dallas and other banker's bank stocks 36,279 28,923
Non-purchased loans 14,440,623 12,733,937
Purchased loans 2,285,168 3,309,092
Allowance for loan losses   (98,200 )   (94,120 )
Net loans 16,627,591 15,948,909
Premises and equipment, net 538,523 519,811
Foreclosed assets 18,470 25,357
Accrued interest receivable 76,091 64,608
Bank owned life insurance (“BOLI”) 716,648 658,147
Intangible assets, net 699,606 709,040
Other, net   315,688   286,591
Total assets $ 22,086,539 $ 21,275,647
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Demand non-interest bearing $ 2,776,549 $ 2,726,623
Savings and interest bearing transaction 9,919,192 10,051,122
Time   5,127,174   4,414,600
Total deposits 17,822,915 17,192,345
Repurchase agreements with customers 51,891 69,331
Other borrowings 1,729 22,320
Subordinated notes 223,185 222,899
Subordinated debentures 119,217 118,800
Accrued interest payable and other liabilities   210,968   186,164
Total liabilities   18,429,905   17,811,859
 
Commitments and contingencies
 
Stockholders’ equity:

Preferred stock; $0.01 par value; 100,000,000 shares authorized; no shares issued or outstanding at September 30, 2018 or December 31, 2017

Common stock; $0.01 par value; 300,000,000 shares authorized; 128,609,237 and 128,287,550 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively

1,286 1,283
Additional paid-in capital 2,234,383 2,221,844
Retained earnings 1,477,178 1,250,313
Accumulated other comprehensive loss   (59,251 )   (12,712 )
Total stockholders’ equity before noncontrolling interest 3,653,596 3,460,728
Noncontrolling interest   3,038   3,060
Total stockholders’ equity   3,656,634   3,463,788
Total liabilities and stockholders’ equity $ 22,086,539 $ 21,275,647
 
   

Bank OZK

Consolidated Statements of Income

Unaudited

 
Three Months Ended Nine Months Ended
September 30, September 30,
2018   2017 2018     2017
(Dollars in thousands, except per share amounts)
Interest income:
Non-purchased loans $ 219,847 $ 159,610 $ 620,659 $ 429,023
Purchased loans 40,173 68,473 138,012 220,196
Investment securities:
Taxable 12,472 7,802 35,380 15,799
Tax-exempt 3,991 5,428 12,252 18,087
Deposits with banks and federal funds sold   1,112   253   2,448   388
Total interest income   277,595   241,566   808,751   683,493
 
Interest expense:
Deposits 51,785 27,077 130,009 66,933
Repurchase agreements with customers 215 33 759 93
Other borrowings 144 255 824 732
Subordinated notes 3,216 3,190 9,542 9,430
Subordinated debentures   1,621   1,289   4,567   3,707
Total interest expense   56,981   31,844   145,701   80,895
 
Net interest income 220,614 209,722 663,050 602,598
Provision for loan losses   41,949   7,777   57,126   18,814
Net interest income after provision for loan losses   178,665   201,945   605,924   583,784
 
Non-interest income:
Service charges on deposit accounts 9,730 9,729 28,959 32,794
Mortgage lending income 24 1,620 517 5,105
Trust income 1,730 1,755 5,114 4,962
BOLI income 5,321 4,453 18,160 13,511
Other income from purchased loans, net 1,418 2,933 5,413 11,447
Loan service, maintenance and other fees 4,724 5,274 15,108 11,407
Gains (losses) on sales of other assets (518 ) 1,363 1,753 3,654
Net gains on investment securities 2,429 17 2,833
Other   1,692   3,191   5,174   7,932
Total non-interest income   24,121   32,747   80,215   93,645
 
Non-interest expense:
Salaries and employee benefits 41,477 35,331 128,641 113,777
Net occupancy and equipment 14,358 13,595 42,335 39,724
Other operating expenses   47,107   35,473   114,883   92,992
Total non-interest expense   102,942   84,399   285,859   246,493
 
Income before taxes 99,844 150,293 400,280 430,936
Provision for income taxes   25,665   54,246   98,227   155,153
Net income 74,179 96,047 302,053 275,783
Earnings attributable to noncontrolling interest   1   (40 )   22   (56 )
Net income available to common stockholders $ 74,180 $ 96,007 $ 302,075 $ 275,727
 
Basic earnings per common share $ 0.58 $ 0.75 $ 2.35 $ 2.21
 
Diluted earnings per common share $ 0.58 $ 0.75 $ 2.35 $ 2.21
 
Dividends declared per common share $ 0.20 $ 0.18 $ 0.585 $ 0.525
 
           

Bank OZK

Consolidated Statements of Stockholders’ Equity

Unaudited

 
Common

Stock

Additional

Paid-In

Capital

Retained

Earnings

Accumulated

Other

Comprehensive

Loss

Non-

Controlling

Interest

Total
(Dollars in thousands, except per share amounts)
 
Balances – December 31, 2016 $ 1,213 $ 1,901,880 $ 914,434 $ (25,920 ) $ 3,264 $ 2,794,871

Cumulative effect of change in accounting principals

    1,133   2,720   (3,408 )     445
Balances – January 1, 2017, as adjusted 1,213 1,903,013 917,154 (29,328 ) 3,264 2,795,316
Net income 275,783 275,783

Earnings attributable to noncontrolling interest

(56 ) 56
Total other comprehensive income 20,294 20,294

Common stock dividends paid, $0.525 per share

(65,019 ) (65,019 )
Dividend paid to noncontrolling interest (250 ) (250 )

Issuance of 158,800 shares of common stock for exercise of stock options

2 2,779 2,781

Issuance of 238,794 shares of unvested restricted common stock

2 (2 )
Stock-based compensation expense 9,182 9,182

Forfeiture of 105,562 shares of unvested restricted common stock

(1 ) 1

Issuance of 14,476 shares of common stock to non-employee directors

Issuance of 6,600,000 shares of common stock, net of stock issuance costs

  66   299,657         299,723
Balances – September 30, 2017 $ 1,282 $ 2,214,630 $ 1,127,862 $ (9,034 ) $ 3,070 $ 3,337,810
 
Balances – December 31, 2017 $ 1,283 $ 2,221,844 $ 1,250,313 $ (12,712 ) $ 3,060 $ 3,463,788
Net income 302,053 302,053
Earnings attributable to noncontrolling interest 22 (22 )
Total other comprehensive loss (46,539 ) (46,539 )

Common stock dividends paid, $0.585 per share

(75,210 ) (75,210 )

Issuance of 216,990 shares of common stock for exercise of stock options

2 5,677 5,679

Issuance of 220,102 shares of unvested restricted common stock

2 (2 )

Repurchase and cancellation of 71,750 shares of common stock

(1 ) (3,769 ) (3,770 )
Stock-based compensation expense 10,633 10,633

Forfeiture of 43,655 shares of unvested restricted common stock

           
Balances – September 30, 2018 $ 1,286 $ 2,234,383 $ 1,477,178 $ (59,251 ) $ 3,038 $ 3,656,634
 
     

Bank OZK

Summary of Non-Interest Expense

Unaudited

 
Three Months Ended Nine Months Ended
September 30, September 30,
2018     2017 2018     2017
(Dollars in thousands)
Salaries and employee benefits $ 41,477 $ 35,331 $ 128,641 $ 113,777
Net occupancy and equipment 14,358 13,595 42,335 39,724
Other operating expenses:
Professional and outside services 9,725 10,018 27,542 22,171
Telecommunication services 3,373 3,321 10,056 10,398
Software and data processing 3,336 2,982 9,786 7,745
Postage and supplies 2,517 1,852 6,930 5,706
Advertising and public relations 6,977 1,907 10,084 4,355
ATM expense 1,202 1,430 3,683 4,081
Travel and meals 2,517 2,223 7,168 6,138
FDIC insurance 3,300 3,500 8,700 7,000
FDIC and state assessments 648 881 2,368 2,531
Loan collection and repossession expense 932 1,249 2,225 4,354
Writedowns of foreclosed and other assets 544 1,028 1,156 2,494
Writedown of signage due to strategic rebranding 4,915 4,915
Amortization of intangibles 3,145 3,145 9,435 9,435
Other   3,976   1,937   10,835   6,584
Total non-interest expense $ 102,942 $ 84,399 $ 285,859 $ 246,493
 
         

Bank OZK

Summary of Total Loans Outstanding

Unaudited

 
September 30, 2018 December 31, 2017
(Dollars in thousands)
Real estate:      
Residential 1-4 family $ 1,055,238 6.3 % $ 1,174,427 7.3 %
Non-farm/non-residential 4,253,779 25.4 4,478,876 27.9
Construction/land development 6,498,207 38.9 6,648,061 41.5
Agricultural 165,936 1.0 150,003 0.9
Multifamily residential   995,368   5.9   508,514   3.2
Total real estate 12,968,528 77.5 12,959,881 80.8
Commercial and industrial 935,087 5.6 738,225 4.6
Consumer 2,127,380 12.7 1,472,593 9.2
Other   694,796   4.2   872,330   5.4
Total loans $ 16,725,791   100.0 % $ 16,043,029   100.0 %
 
   

Bank OZK

Selected Consolidated Financial Data

(Dollars in thousands, except per share amounts)

Unaudited

 
Three Months Ended

September 30,

Nine Months Ended

September 30,

2018   2017   % Change 2018   2017   % Change

Income statement data:

   
Net interest income $ 220,614 $ 209,722 5.2 % $ 663,050 $ 602,598 10.0 %
Provision for loan losses 41,949 7,777 439.4 57,126 18,814 203.6
Non-interest income 24,121 32,747 (26.3 ) 80,215 93,645 (14.3 )
Non-interest expense 102,942 84,399 22.0 285,859 246,493 16.0
Net income available to common stockholders 74,180 96,007 (22.7 ) 302,075 275,727 9.6

Common stock data:

Net income per share - diluted $ 0.58 $ 0.75 (22.7 )% $ 2.35 $ 2.21 6.3 %
Net income per share - basic 0.58 0.75 (22.7 ) 2.35 2.21 6.3
Cash dividends per share 0.20 0.18 11.1 0.585 0.525 11.4
Book value per share 28.41 26.02 9.2 28.41 26.02 9.2
Tangible book value per share(1) 22.97 20.46 12.3 22.97 20.46 12.3
Diluted shares outstanding (thousands) 128,744 128,472 128,771 124,900
End of period shares outstanding (thousands) 128,609 128,174 128,609 128,174

Balance sheet data at period end:

Assets $ 22,086,539 $ 20,768,493 6.3 % $ 22,086,539 $ 20,768,493 6.3 %
Total loans 16,725,791 15,778,630 6.0 16,725,791 15,778,630 6.0
Non-purchased loans 14,440,623 12,047,094 19.9 14,440,623 12,047,094 19.9
Purchased loans 2,285,168 3,731,536 (38.8 ) 2,285,168 3,731,536 (38.8 )
Allowance for loan losses 98,200 86,784 13.2 98,200 86,784 13.2
Foreclosed assets 18,470 28,016 (34.1 ) 18,470 28,016 (34.1 )
Investment securities 2,706,156 1,975,102 37.0 2,706,156 1,975,102 37.0
Goodwill and other intangible assets 699,606 712,185 (1.8 ) 699,606 712,185 (1.8 )
Deposits 17,822,915 16,823,359 5.9 17,822,915 16,823,359 5.9
Repurchase agreements with customers 51,891 70,165 (26.0 ) 51,891 70,165 (26.0 )
Other borrowings 1,729 42,404 (95.9 ) 1,729 42,404 (95.9 )
Subordinated notes 223,185 222,802 0.2 223,185 222,802 0.2
Subordinated debentures 119,217 118,660 0.5 119,217 118,660 0.5
Unfunded balance of closed loans 11,891,247 12,519,839 (5.0 ) 11,891,247 12,519,839 (5.0 )
Common stockholders’ equity 3,653,596 3,334,740 9.6 3,653,596 3,334,740 9.6

Net unrealized losses on investment securities AFS included in common stockholders' equity

(59,251 ) (5,626 ) (59,251 ) (5,626 )
Loan (including purchased loans) to deposit ratio 93.84 % 93.79 % 93.84 % 93.79 %

Selected ratios:

Return on average assets(2) 1.33 % 1.89 % 1.85 % 1.91 %
Return on average common stockholders’ equity(2) 8.07 11.56 11.32 12.10
Return on average tangible common stockholders’ equity(1) (2) 9.99 14.76 14.11 15.81
Average common equity to total average assets 16.47 16.35 16.38 15.77
Net interest margin – FTE(2) 4.47 4.84 4.60 4.90
Efficiency ratio 41.87 34.38 38.28 34.90
Net charge-offs to average non-purchased loans(2) (3) 1.32 0.08 0.49 0.06
Net charge-offs to average total loans(2) 1.14 0.09 0.43 0.08
Nonperforming loans to total loans(4) 0.23 0.11 0.23 0.11
Nonperforming assets to total assets(4) 0.23 0.20 0.23 0.20
Allowance for loan losses to non-purchased loans(5) 0.67 0.71