Press Release

Bank OZK Announces Second Quarter 2020 Earnings

Company Release - 7/23/2020 4:01 PM ET

LITTLE ROCK, Ark., July 23, 2020 (GLOBE NEWSWIRE) -- Bank OZK (the “Bank”) (Nasdaq: OZK) today announced that net income for the second quarter of 2020 was $50.3 million, a 54.5% decrease from $110.5 million for the second quarter of 2019.  Diluted earnings per common share for the second quarter of 2020 were $0.39, a 54.7% decrease from $0.86 for the second quarter of 2019.

For the six months ended June 30, 2020, net income was $62.1 million, a 71.9% decrease from $221.2 million for the first six months of 2019.  Diluted earnings per common share for the first six months of 2020 were $0.48, a 71.9% decrease from $1.71 for the first six months of 2019.

The COVID-19 pandemic significantly affected the global economy in the first half of 2020.  The sudden and severe economic downturn, combined with the implementation of the current expected credit losses (“CECL”) method to calculate the Bank’s allowance for credit losses (“ACL”) and uncertain future economic projections, resulted in the Bank incurring provision for credit losses of $72.0 million in the second quarter and $189.7 million in the first six months of 2020, resulting in a total ACL of $374.5 million at June 30, 2020.

The Bank’s annualized returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the second quarter of 2020 were 0.78%, 4.92% and 5.89%, respectively, compared to 1.95%, 11.29% and 13.70%, respectively, for the second quarter of 2019.  The Bank’s annualized returns on average assets, average common stockholder’s equity and average tangible stockholders’ equity for the first six months of 2020 were 0.50%, 3.04% and 3.64%, respectively, compared to 1.97%, 11.52%, and 14.04%, respectively, for the first six months of 2019.  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, “We have continued our long-standing focus on our team members, our customers, serving the communities in which we operate and delivering favorable returns for shareholders. Our strong credit culture and consistent discipline have been important ingredients in our success, and we believe they have positioned us well for the current economic environment.”

KEY BALANCE SHEET METRICS

Total loans were $19.31 billion at June 30, 2020, a 10.4% increase from $17.49 billion at June 30, 2019.  Non-purchased loans, which exclude loans acquired in previous acquisitions, were $18.25 billion at June 30, 2020, a 15.6% increase from $15.79 billion at June 30, 2019.  Purchased loans, which consist of loans acquired in previous acquisitions, were $1.06 billion at June 30, 2020, a 37.4% decrease from $1.70 billion at June 30, 2019. 

Deposits were $20.72 billion at June 30, 2020, a 14.0% increase from $18.19 billion at June 30, 2019.  Total assets were $26.38 billion at June 30, 2020, a 14.9% increase from $22.96 billion at June 30, 2019.

Common stockholders’ equity was $4.11 billion at June 30, 2020, a 2.9% increase from $3.99 billion at June 30, 2019. Tangible common stockholders’ equity was $3.43 billion at June 30, 2020, a 3.9% increase from $3.30 billion at June 30, 2019.  Book value per common share was $31.78 at June 30, 2020, a 2.6% increase from $30.97 at June 30, 2019.  Tangible book value per common share was $26.53 at June 30, 2020, a 3.6% increase from $25.61 at June 30, 2019.  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 15.58% at June 30, 2020 compared to 17.39% at June 30, 2019.  Its ratio of total tangible common stockholders’ equity to total tangible assets was 13.35% at June 30, 2020 compared to 14.83% at June 30, 2019.  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. 

MANAGEMENT’S COMMENTS, CONFERENCE CALL, TRANSCRIPT AND FILINGS

In connection with this release, the Bank released management’s comments on its quarterly results, which are available at http://ir.ozk.com.  This release should be read in conjunction with management’s comments on the quarterly results.

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 July 24, 2020.  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 4695153.  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.  To receive automated email alerts for these materials, please visit http://ir.ozk.com/EmailNotification to sign up.

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, the ratio of total tangible common stockholders’ equity to total tangible assets and pre-tax pre-provision net revenue, to assess the strength of its capital, its ability to generate earnings on tangible capital invested by its shareholders and trends in its core earnings. These measures typically adjust GAAP financial measures to exclude intangible assets and provision for credit losses.  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.”

STATEMENT REGARDING IMPACT OF COVID-19 PANDEMIC

The Bank prioritizes the health and safety of its employees and customers, and it will continue to do so throughout the duration of the pandemic.  At the same time, the Bank remains focused on improving shareholder value, managing credit exposure, managing expenses, enhancing the customer experience and supporting the communities it serves.

In management’s comments on its quarterly results (released simultaneously with this news release) and in its earnings conference call, the Bank has sought and will seek to describe the historical and future impact of the COVID-19 pandemic on the Bank’s assets, business, cash flows, financial condition, liquidity, prospects and results of operations, including the information and discussions regarding the increases in its provision and allowance for credit losses and the discussion regarding negative pressure to its net interest margin.  Although the Bank believes that the statements that pertain to future events, results and trends and their impact on the Bank’s business are reasonable at the present time, those statements are not historical facts and are based upon current assumptions, expectations, estimates and projections, many of which, by their nature, are beyond the Bank’s control.  Accordingly, all discussions regarding future events, results and trends and their impact on the Bank’s business, even in the near term, are necessarily uncertain given the fluid and evolving nature of the pandemic.

If the health, logistical or economic effects of the pandemic worsen, or if the assumptions, expectations, estimates or projections that underlie the Bank’s statements regarding future effects or trends prove to be incorrect, then the Bank’s actual assets, business, cash flows, financial condition, liquidity, prospects and results of operations may be materially and adversely impacted in ways that the Bank cannot reasonably forecast.  Accordingly, when reading this news release and the accompanying prepared remarks from management on its quarterly results and when listening to the earnings conference call, undue reliance should not be placed upon any statement pertaining to future events, results and trends and their impact on the Bank’s business in future periods.

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 satisfactory sites, hiring or retaining qualified personnel, obtaining regulatory or other approvals, obtaining permits and designing, constructing and opening new offices or relocating, selling or closing existing offices; the ability to enter into and/or close additional acquisitions; 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; the potential impact of the proposed phase-out of the London Interbank Offered Rate (“LIBOR”) or other changes involving LIBOR; 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; changes in legal, financial and/or regulatory requirements; recently enacted and potential legislation and regulatory actions and the costs and expenses to comply with new and/or existing legislation and regulatory actions, including those in response to the coronavirus (COVID-19) pandemic; changes in U.S. Government monetary and fiscal policy; 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, the Bank’s operational or security systems or infrastructure, or those of third parties with whom it does 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; natural disasters or acts of war or terrorism; the adverse effects of the ongoing global COVID-19 pandemic, including the magnitude and duration of the pandemic and actions taken to contain or treat COVID-19, on the Bank, the Bank’s customers, the global economy and financial markets; international or political instability; impairment of our goodwill or other intangible assets; adoption of new accounting standards, including the effects from the adoption of the CECL model on January 1, 2020, 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 other public reports the Bank files with the FDIC, including those factors described 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, 2019 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 is the #1 capitalized bank among the nation’s top 100 largest publicly traded U.S. banks by asset size, based on Tier 1 Leverage Capital Ratio at March 31, 2020, according to data obtained from S&P Global Market Intelligence. Bank OZK was named Best Bank in the South for 2019-2020 by Money, the personal finance news and advice brand. Headquartered in Little Rock, Arkansas, Bank OZK conducts operations through more than 250 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. 

   
Investor Contact: Tim Hicks (501) 978-2336
Media Contact: Susan Blair (501) 978-2217



Bank OZK
Consolidated Balance Sheets

Unaudited

   June 30,  December 31, 
  2020  2019 
    
  (Dollars in thousands, except per share amounts) 
ASSETS        
Cash and cash equivalents $1,646,070  $1,495,757 
Investment securities ― available for sale ("AFS")  3,299,944   2,277,389 
Federal Home Loan Bank of Dallas and other banker's bank stocks  50,742   21,855 
Non-purchased loans  18,247,431   16,224,539 
Purchased loans  1,063,647   1,307,504 
Allowance for loan losses  (306,196)  (108,525)
Net loans  19,004,882   17,423,518 
Premises and equipment, net  732,674   711,541 
Foreclosed assets  18,328   19,096 
Accrued interest receivable  82,729   75,208 
Bank owned life insurance (“BOLI”)  748,193   738,860 
Goodwill and intangible assets, net  679,166   684,542 
Other, net  117,681   107,962 
Total assets $26,380,409  $23,555,728 
         
LIABILITIES AND STOCKHOLDERS EQUITY        
Deposits:        
Demand non-interest bearing $3,696,306  $2,795,251 
Savings and interest bearing transaction  7,447,640   8,307,607 
Time  9,579,652   7,371,401 
Total deposits  20,723,598   18,474,259 
Repurchase agreements with customers  9,277   11,249 
Other borrowings  903,696   351,387 
Subordinated notes  223,854   223,663 
Subordinated debentures  120,194   119,916 
Reserve for losses on unfunded loan commitments  68,298    
Accrued interest payable and other liabilities  217,726   221,786 
Total liabilities  22,266,643   19,402,260 
         
Commitments and contingencies        
         
Stockholders’ equity:        
Preferred stock; $0.01 par value; 100,000,000 shares authorized; no shares issued or outstanding at June 30, 2020 or December 31, 2019      
Common stock; $0.01 par value; 300,000,000 shares authorized; 129,350,301 and 128,951,024 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively  1,293   1,289 
Additional paid-in capital  2,257,867   2,251,824 
Retained earnings  1,788,329   1,869,983 
Accumulated other comprehensive income  63,177   27,255 
Total stockholders’ equity before noncontrolling interest  4,110,666   4,150,351 
Noncontrolling interest  3,100   3,117 
Total stockholders’ equity  4,113,766   4,153,468 
Total liabilities and stockholders’ equity $26,380,409  $23,555,728 



Bank OZK
Consolidated Statements of Income
Unaudited

  Three Months Ended June 30,  Six Months Ended June 30, 
 2020  2019  2020  2019 
            
 (Dollars in thousands, except per share amounts) 
Interest income:               
Non-purchased loans$232,816  $250,081  $464,669  $495,946 
Purchased loans 17,087   28,519   38,474   58,714 
Investment securities:               
Taxable 11,055   13,585   21,814   28,481 
Tax-exempt 5,846   3,693   9,443   7,567 
Deposits with banks and federal funds sold 330   941   4,706   1,354 
Total interest income 267,134   296,819   539,106   592,062 
                
Interest expense:               
Deposits 45,251   67,392   102,933   130,479 
Repurchase agreements with customers 6   11   13   33 
Other borrowings 963   19   1,013   1,408 
Subordinated notes 3,172   3,181   6,344   6,326 
Subordinated debentures 1,149   1,680   2,436   3,392 
Total interest expense 50,541   72,283   112,739   141,638 
                
Net interest income 216,593   224,536   426,367   450,424 
Provision for credit losses 72,026   6,769   189,689   13,450 
Net interest income after provision for loan losses 144,567   217,767   236,678   436,974 
                
Non-interest income:               
Service charges on deposit accounts 8,281   10,291   18,290   20,014 
Trust income 1,759   1,839   3,698   3,569 
BOLI income:               
Increase in cash surrender value 5,057   5,178   10,124   10,340 
Death benefits       608    
Loan service, maintenance and other fees 3,394   4,565   7,110   9,438 
Other income from purchased loans    1,455      2,251 
Gains on sales of other assets 621   402   783   686 
Net gains on investment securities    713   2,223   713 
Other 2,479   2,160   6,435   3,664 
Total non-interest income 21,591   26,603   49,271   50,675 
                
Non-interest expense:               
Salaries and employee benefits 48,410   47,558   99,883   92,425 
Net occupancy and equipment 15,756   14,587   31,086   29,338 
Other operating expenses 36,787   36,986   73,409   74,046 
Total non-interest expense 100,953   99,131   204,378   195,809 
                
Income before taxes 65,205   145,239   81,571   291,840 
Provision for income taxes 14,948   34,726   19,456   70,615 
Net income 50,257   110,513   62,115   221,225 
Earnings attributable to noncontrolling interest 9   (10)  17   (16)
Net income available to common stockholders$50,266  $110,503  $62,132  $221,209 
                
Basic earnings per common share$0.39  $0.86  $0.48  $1.72 
                
Diluted earnings per common share$0.39  $0.86  $0.48  $1.71 



Bank OZK
Consolidated Statements of Stockholders’ Equity
Unaudited

   Common
Stock
  Additional
Paid-In
Capital
  Retained
Earnings
  Accumulated
Other
Comprehensive
Income (Loss)
  Non-
Controlling
Interest
  Total 
    
  (Dollars in thousands, except per share amounts) 
Three months ended June 30, 2020:                        
Balances – March 31, 2020 $1,293  $2,253,991  $1,772,978  $54,888  $3,109  $4,086,259 
Net income        50,257         50,257 
Earnings attributable to noncontrolling interest        9      (9)   
Total other comprehensive income           8,289      8,289 
Common stock dividends paid, $0.27 per share        (34,915)        (34,915)
Issuance of 46,676 shares of unvested restricted common stock                  
Stock-based compensation expense     3,876            3,876 
Forfeitures of 20,810 shares of unvested restricted common stock                  
Balances – June 30, 2020 $1,293  $2,257,867  $1,788,329  $63,177  $3,100  $4,113,766 
                         
Six months ended June 30, 2020:                        
Balances – December 31, 2019 $1,289  $2,251,824  $1,869,983  $27,255  $3,117  $4,153,468 
Cumulative effect of change in accounting principle        (75,344)        (75,344)
Balances – January 1, 2020  1,289   2,251,824   1,794,639   27,255   3,117   4,078,124 
Net income        62,115         62,115 
Earnings attributable to noncontrolling interest        17      (17)   
Total other comprehensive income           35,922      35,922 
Common stock dividends paid, $0.53 per share        (68,442)        (68,442)
Issuance of 4,300 shares of common stock for exercise of stock options     45            45 
Issuance of 493,761 shares of unvested restricted common stock  5   (5)            
Repurchase and cancellation of 61,873 shares of common stock  (1)  (1,852)           (1,853)
Stock-based compensation expense     7,855            7,855 
Forfeitures of 36,911 shares of unvested restricted common stock                  
Balances – June 30, 2020 $1,293  $2,257,867  $1,788,329  $63,177  $3,100  $4,113,766 



Bank OZK
Consolidated Statements of Stockholders’ Equity (Continued)
Unaudited

   Common
Stock
  Additional
Paid-In
Capital
  Retained
Earnings
  Accumulated
Other
Comprehensive
Income (Loss)
  Non-
Controlling
Interest
  Total 
    
  (Dollars in thousands, except per share amounts) 
Three months ended June 30, 2019:                        
Balances – March 31, 2019 $1,289  $2,239,404  $1,647,626  $(5,676) $3,121  $3,885,764 
Net income        110,513         110,513 
Earnings attributable to noncontrolling interest        (10)     10    
Total other comprehensive income           25,369      25,369 
Common stock dividends paid, $0.23 per share        (29,643)        (29,643)
Issuance of 27,250 shares of common stock for exercise of stock options  1   489            490 
Issuance of 22,200 shares of unvested restricted common stock                  
Stock-based compensation expense     3,885            3,885 
Forfeiture of 50,262 shares of unvested restricted common stock  (1)  1             
Balances – June 30, 2019 $1,289  $2,243,779  $1,728,486  $19,693  $3,131  $3,996,378 
                         
Six months ended June 30, 2019:                        
Balances – December 31, 2018 $1,286  $2,237,948  $1,565,201  $(34,105) $3,035  $3,773,365 
Net income        221,225         221,225 
Earnings attributable to noncontrolling interest        (16)     16    
Total other comprehensive income           53,798      53,798 
Common stock dividends paid, $0.45 per share        (57,924)        (57,924)
Noncontrolling interest cash contribution              80   80 
Issuance of 56,550 shares of common stock for exercise of stock options  1   876            877 
Issuance of 406,074 shares of unvested restricted common stock  4   (4)            
Repurchase and cancellation of 62,742 shares of common stock  (1)  (1,646)           (1,647)
Stock-based compensation expense     6,604            6,604 
Forfeiture of 64,215 shares of unvested restricted common stock  (1)  1             
Balances – June 30, 2019 $1,289  $2,243,779  $1,728,486  $19,693  $3,131  $3,996,378 



Bank OZK
Summary of Non-Interest Expense
Unaudited

  Three Months Ended
June 30,
  Six Months Ended
June 30,
 
  2020  2019  2020  2019 
    
  (Dollars in thousands) 
Salaries and employee benefits $48,410  $47,558  $99,883  $92,425 
Net occupancy and equipment  15,756   14,587   31,086   29,338 
Other operating expenses:                
Professional and outside services  7,939   8,105   14,982   16,669 
Software and data processing  5,145   4,757   10,119   9,466 
Deposit insurance and assessments  4,585   3,488   8,005   7,140 
Telecommunication services  2,334   2,810   4,511   6,154 
Postage and supplies  1,892   2,058   3,945   4,161 
Advertising and public relations  1,704   1,671   3,407   3,353 
Travel and meals  710   2,939   2,812   5,608 
ATM expense  1,002   1,099   2,162   2,086 
Loan collection and repossession expense  857   918   1,551   1,901 
Writedowns of foreclosed assets  720   594   1,599   1,155 
Amortization of intangibles  2,582   3,012   5,377   6,157 
Other  7,317   5,535   14,939   10,196 
Total non-interest expense $100,953  $99,131  $204,378  $195,809 



Bank OZK
Summary of Total Loans Outstanding
Unaudited

                  
  June 30, 2020  December 31, 2019 
    
  (Dollars in thousands) 
Real estate:                
Residential 1-4 family $1,002,627   5.2% $998,632   5.7%
Non-farm/non-residential  4,383,137   22.7   3,956,579   22.6 
Construction/land development  7,030,963   36.4   6,391,429   36.4 
Agricultural  232,121   1.2   230,076   1.3 
Multifamily residential  1,371,449   7.1   1,194,192   6.8 
Total real estate  14,020,297   72.6   12,770,908   72.8 
Commercial and industrial  1,005,900   5.2   661,952   3.8 
Consumer  2,843,396   14.7   2,934,534   16.8 
Other  1,441,485   7.5   1,164,649   6.6 
Total loans  19,311,078   100.0%  17,532,043   100.0%
Allowance for loan losses  (306,196)      (108,525)    
Net loans $19,004,882      $17,423,518     



Bank OZK
Allowance for Credit Losses
Unaudited

             
  Allowance for Loan Losses  Reserve for Losses on Unfunded Loan Commitments  Total Allowance for Credit Losses 
    
  (Dollars in thousands) 
Three months ended June 30, 2020:            
Balances – March 31, 2020 $238,737  $77,672  $316,409 
Net charge-offs  (13,941)     (13,941)
Provision for credit losses  81,400   (9,374)  72,026 
Balances – June 30, 2020 $306,196  $68,298  $374,494 
             
Six months ended June 30, 2020:            
Balances – December 31, 2019 $108,525  $  $108,525 
Adoption of Current Expected Credit Loss (CECL) methodology  39,588   54,924   94,512 
Balances – January 1, 2020  148,113   54,924   203,037 
Net charge-offs  (18,232)     (18,232)
Provision for credit losses  176,315   13,374   189,689 
Balances – June 30, 2020 $306,196  $68,298  $374,494 
             
Three months ended June 30, 2019:            
Balances – March 31, 2019 $105,954  $  $105,954 
Net charge-offs  (6,081)     (6,081)
Provision for credit losses  6,769      6,769 
Balances – June 30, 2019 $106,642  $  $106,642 
             
Six months ended June 30, 2019:            
Balances – December 31, 2018 $102,264  $  $102,264 
Net charge-offs  (9,072)     (9,072)
Provision for credit losses  13,450      13,450 
Balances – June 30, 2019 $106,642  $  $106,642 



Bank OZK
Summary of Deposits – By Account Type
Unaudited

                  
  June 30, 2020  December 31, 2019 
    
  (Dollars in thousands) 
Non-interest bearing $3,696,306   17.8% $2,795,251   15.1%
Interest bearing:                
Transaction (NOW)  2,929,462   14.1   2,706,426   14.7 
Savings and money market  4,518,178   21.8   5,601,181   30.3 
Time deposits less than $100  3,783,621   18.3   3,321,446   18.0 
Time deposits of $100 or more  5,796,031   28.0   4,049,955   21.9 
Total deposits $20,723,598   100.0% $18,474,259   100.0%



Summary of Deposits – By Customer Type
Unaudited

     
  June 30, 2020  December 31, 2019 
    
  (Dollars in thousands) 
Consumer $10,083,452   48.7% $7,526,014   40.7%
Commercial  5,439,295   26.2   4,334,366   23.5 
Public Funds  2,545,778   12.3   3,782,415   20.5 
Brokered  2,018,331   9.7   2,115,193   11.4 
Reciprocal  636,742   3.1   716,271   3.9 
Total deposits $20,723,598   100.0% $18,474,259   100.0%



Bank OZK
Selected Consolidated Financial Data
Unaudited

   Three Months Ended
June 30,
  Six Months Ended
June 30,
 
  2020  2019  % Change  2020  2019  % Change 
    
  (Dollars in thousands, except per share amounts) 
Income statement data:                        
Net interest income $216,593  $224,536   (3.5)% $426,367  $450,424   (5.3)%
Provision for credit losses  72,026   6,769   964.1   189,689   13,450   1,310.3 
Non-interest income  21,591   26,603   (18.8)  49,271   50,675   (2.8)
Non-interest expense  100,953   99,131   1.8   204,378   195,809   4.4 
Net income available to common stockholders  50,266   110,503   (54.5)  62,132   221,209   (71.9)
Pre-tax pre-provision net revenue (1)  137,231   152,008   (9.7)  271,260   305,290   (11.1)
Common share and per common share data:                        
Net income per share − diluted $0.39  $0.86   (54.7)% $0.48  $1.71   (71.9)%
Net income per share − basic  0.39   0.86   (54.7)  0.48   1.72   (72.1)
Cash dividends per share  0.27   0.23   17.4   0.53   0.45   17.8 
Book value per share  31.78   30.97   2.6   31.78   30.97   2.6 
Tangible book value per share(1)  26.53   25.61   3.6   26.53   25.61   3.6 
Weighted-average diluted shares outstanding (thousands)  129,399   129,079       129,349   129,022     
End of period shares outstanding (thousands)  129,350   128,947       129,350   128,947     
Balance sheet data at period end:                        
Total assets $26,380,409  $22,960,731   14.9% $26,380,409  $22,960,731   14.9%
Total loans  19,311,078   17,485,205   10.4   19,311,078   17,485,205   10.4 
Non-purchased loans  18,247,431   15,786,809   15.6   18,247,431   15,786,809   15.6 
Purchased loans  1,063,647   1,698,396   (37.4)  1,063,647   1,698,396   (37.4)
Allowance for loan losses  306,196   106,642   187.1   306,196   106,642   187.1 
Foreclosed assets  18,328   33,467   (45.2)  18,328   33,467   (45.2)
Investment securities − AFS  3,299,944   2,548,489   29.5   3,299,944   2,548,489   29.5 
Goodwill and other intangible assets, net  679,166   690,304   (1.6)  679,166   690,304   (1.6)
Deposits  20,723,598   18,186,215   14.0   20,723,598   18,186,215   14.0 
Other borrowings  903,696   201,455   348.6   903,696   201,455   348.6 
Subordinated notes  223,854   223,471   0.2   223,854   223,471   0.2 
Subordinated debentures  120,194   119,635   0.5   120,194   119,635   0.5 
Unfunded balance of closed loans  11,411,441   11,167,055   2.2   11,411,441   11,167,055   2.2 
Reserve for losses on unfunded loan commitments  68,298     NM   68,298     NM 
Total common stockholders’ equity  4,110,666   3,993,247   2.9   4,110,666   3,993,247   2.9 
Net unrealized gains on investment securities AFS included in common stockholders' equity  63,177   19,693       63,177   19,693     
Loan (including purchased loans) to deposit ratio  93.18%  96.15%      93.18%  96.15%    
Selected ratios:                        
Return on average assets(2)  0.78%  1.95%      0.50%  1.97%    
Return on average common stockholders’ equity(2)  4.92   11.29       3.04   11.52     
Return on average tangible common stockholders’ equity(1) (2)  5.89   13.70       3.64   14.04     
Average common equity to total average assets  15.93   17.31       16.59   17.12     
Net interest margin – FTE(2)  3.74   4.45       3.84   4.49     
Efficiency ratio  42.07   39.30       42.71   38.89     
Net charge-offs to average non-purchased loans(2) (3)  0.05   0.12       0.06   0.09     
Net charge-offs to average total loans(2)  0.29   0.14       0.20   0.10     
Nonperforming loans to total loans(4)  0.18   0.15       0.18   0.15     
Nonperforming assets to total assets(4)  0.19   0.25       0.19   0.25     
Allowance for loan losses to total loans (5)  1.59   0.61      1.59  0.61     
Other information:                        
Non-accrual loans(4) $31,083  $22,860      $31,083  $22,860     
Accruing loans − 90 days past due(4)                    
Troubled and restructured non-purchased loans − accruing(4)  934   1,399       934   1,399     


(1)  Calculations of pre-tax pre-provision net revenue, tangible book value per common share and return on average tangible common stockholders’ equity and the reconciliations to GAAP are included in the schedules accompanying this release.
(2)  Ratios for interim periods annualized based on actual days.
(3)  Excludes purchased loans and net charge-offs related to such loans.
(4)  Excludes purchased loans, except for their inclusion in total assets.
(5)  Excludes reserve for losses on unfunded loan commitments.
NM – Not meaningful



Selected Consolidated Financial Data (continued)
Unaudited

  Three Months Ended 
  June 30,  March 31,     
  2020  2020  % Change 
 (Dollars in thousands, except per share amounts) 
Income statement data:            
Net interest income $216,593  $209,775   3.3%
Provision for credit losses  72,026   117,663   (38.8)
Non-interest income  21,591