Press Release

Bank OZK Announces Third Quarter 2020 Earnings

10/22/2020 at 4:01 PM EDT

LITTLE ROCK, Ark., Oct. 22, 2020 (GLOBE NEWSWIRE) -- Bank OZK (the “Bank”) (Nasdaq: OZK) today announced that net income for the third quarter of 2020 was $109.3 million, a 5.2% increase from $103.9 million for the third quarter of 2019. Diluted earnings per common share for the third quarter of 2020 were $0.84, a 3.7% increase from $0.81 for the third quarter of 2019.

For the nine months ended September 30, 2020, net income was $171.4 million, a 47.3% decrease from $325.1 million for the first nine months of 2019. Diluted earnings per common share for the first nine months of 2020 were $1.32, a 47.6% decrease from $2.52 for the first nine months of 2019.

Pre-tax pre-provision net revenue (“PPNR”) was $145.7 million for the third quarter of 2020, a 1.0% increase from $144.3 million for the third quarter of 2019. PPNR was $417.0 million for the first nine months of 2020, a 7.3% decrease from $449.6 million for the first nine months of 2019. The calculation of PPNR and the reconciliation to generally accepted accounting principles (“GAAP”) are included in the schedules accompanying this release.

The COVID-19 pandemic significantly affected the global economy in the first nine months 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 $7.2 million in the third quarter and $196.9 million in the first nine months of 2020, resulting in a total ACL of $377.3 million at September 30, 2020.

The Bank’s annualized returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the third quarter of 2020 were 1.63%, 10.48% and 12.52%, respectively, compared to 1.81%, 10.22% and 12.33%, respectively, for the third quarter of 2019. The Bank’s annualized returns on average assets, average common stockholder’s equity and average tangible common stockholders’ equity for the first nine months of 2020 were 0.90%, 5.55% and 6.65%, respectively, compared to 1.92%, 11.07%, and 13.44%, respectively, for the first nine months of 2019. The calculation of the Bank’s return on average tangible common stockholders’ equity and the reconciliation to GAAP are included in the schedules accompanying this release.

George Gleason, Chairman and Chief Executive Officer stated, “Our strong credit culture and consistent discipline are important ingredients in our long-term success, and we believe they have positioned us well for the current economic environment and beyond. This is clearly evident in our excellent asset quality and earnings for the quarter just ended.”

KEY BALANCE SHEET METRICS

Total loans were $19.36 billion at September 30, 2020, a 9.2% increase from $17.73 billion at September 30, 2019. Non-purchased loans, which exclude loans acquired in previous acquisitions, were $18.42 billion at September 30, 2020, a 13.0% increase from $16.31 billion at September 30, 2019.   Purchased loans, which consist of loans acquired in previous acquisitions, were $0.94 billion at September 30, 2020, a 34.2% decrease from $1.43 billion at September 30, 2019.

Deposits were $21.29 billion at September 30, 2020, a 15.4% increase from $18.44 billion at September 30, 2019. Total assets were $26.89 billion at September 30, 2020, a 14.9% increase from $23.40 billion at September 30, 2019.

Common stockholders’ equity was $4.19 billion at September 30, 2020, a 2.6% increase from $4.08 billion at September 30, 2019. Tangible common stockholders’ equity was $3.51 billion at September 30, 2020, a 3.5% increase from $3.39 billion at September 30, 2019. Book value per common share was $32.37 at September 30, 2020, a 2.3% increase from $31.63 at September 30, 2019. Tangible book value per common share was $27.13 at September 30, 2020, a 3.2% increase from $26.30 at September 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 15.57% at September 30, 2020 compared to 17.43% at September 30, 2019. Its ratio of total tangible common stockholders’ equity to total tangible assets was 13.39% at September 30, 2020 compared to 14.93% at September 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 October 23, 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 4644917. 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 PPNR, to assess the strength of its capital, its ability to generate earnings on tangible capital invested by its shareholders and trends in its net revenue. 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 increasing 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 its provision and allowance for credit losses and the discussion regarding 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, including any changes that result from the upcoming elections in November; 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 the Bank’s goodwill or other intangible assets; adoption of new accounting standards, including the effects from the adoption of the CECL methodology 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 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 FacebookTwitter 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

    September 30,     December 31,  
    2020     2019  
    (Dollars in thousands, except per share amounts)  
ASSETS                
Cash and cash equivalents   $ 1,934,095     $ 1,495,757  
Investment securities ― available for sale ("AFS")     3,468,243       2,277,389  
Federal Home Loan Bank of Dallas and other bankers' bank stocks     38,388       21,855  
Non-purchased loans     18,419,958       16,224,539  
Purchased loans     938,485       1,307,504  
Allowance for loan losses     (308,847 )     (108,525 )
Net loans     19,049,596       17,423,518  
Premises and equipment, net     739,066       711,541  
Foreclosed assets     16,543       19,096  
Accrued interest receivable     85,858       75,208  
Bank owned life insurance (“BOLI”)     753,038       738,860  
Goodwill and other intangible assets, net     677,251       684,542  
Other, net     126,230       107,962  
Total assets   $ 26,888,308     $ 23,555,728  
                 
LIABILITIES AND STOCKHOLDERS EQUITY                
Deposits:                
Demand non-interest bearing   $ 3,908,207     $ 2,795,251  
Savings and interest bearing transaction     7,585,032       8,307,607  
Time     9,794,166       7,371,401  
Total deposits     21,287,405       18,474,259  
Repurchase agreements with customers     4,994       11,249  
Other borrowings     750,949       351,387  
Subordinated notes     223,950       223,663  
Subordinated debentures     120,335       119,916  
Reserve for losses on unfunded loan commitments     68,426        
Accrued interest payable and other liabilities     242,876       221,786  
Total liabilities     22,698,935       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 September 30, 2020 or December 31, 2019
           
Common stock; $0.01 par value; 300,000,000 shares authorized;
129,342,073 and 128,951,024 shares issued and outstanding at
September 30, 2020 and December 31, 2019, respectively
    1,293       1,289  
Additional paid-in capital     2,261,864       2,251,824  
Retained earnings     1,862,012       1,869,983  
Accumulated other comprehensive income     61,116       27,255  
Total stockholders’ equity before noncontrolling interest     4,186,285       4,150,351  
Noncontrolling interest     3,088       3,117  
Total stockholders’ equity     4,189,373       4,153,468  
Total liabilities and stockholders’ equity   $ 26,888,308     $ 23,555,728  

Bank OZK
Consolidated Statements of Income
Unaudited

  Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
  2020     2019     2020     2019  
  (Dollars in thousands, except per share amounts)  
Interest income:                              
Non-purchased loans $ 236,621     $ 244,954     $ 701,290     $ 740,900  
Purchased loans   16,269       26,042       54,743       84,756  
Investment securities:                              
Taxable   9,666       12,511       31,480       40,992  
Tax-exempt   5,193       3,363       14,636       10,930  
Deposits with banks and federal funds sold   532       2,647       5,237       4,001  
Total interest income   268,281       289,517       807,386       881,579  
                               
Interest expense:                              
Deposits   38,273       66,248       141,206       196,727  
Repurchase agreements with customers   4       5       17       39  
Other borrowings   1,156       90       2,168       1,497  
Subordinated notes   3,207       3,216       9,551       9,542  
Subordinated debentures   984       1,178       3,420       4,570  
Total interest expense   43,624       70,737       156,362       212,375  
                               
Net interest income   224,657       218,780       651,024       669,204  
Provision for credit losses   7,200       7,854       196,889       21,303  
Net interest income after provision for credit losses   217,457       210,926       454,135       647,901  
                               
Non-interest income:                              
Service charges on deposit accounts   9,427       10,827       27,717       30,841  
Trust income   1,936       1,975       5,635       5,544  
BOLI income:                              
Increase in cash surrender value   5,081       5,208       15,205       15,547  
Death benefits         206       608       206  
Loan service, maintenance and other fees   3,351       4,197       10,461       13,636  
Other income from purchased loans         674             2,925  
Gains on sales of other assets   891       189       1,674       875  
Net gains on investment securities   2,244             4,467       713  
Other   3,746       3,170       10,180       6,834  
Total non-interest income   26,676       26,446       75,947       77,121  
                               
Non-interest expense:                              
Salaries and employee benefits   53,119       48,376       153,003       140,801  
Net occupancy and equipment   16,676       14,825       47,761       44,163  
Other operating expenses   35,846       37,713       109,255       111,760  
Total non-interest expense   105,641       100,914       310,019       296,724  
                               
Income before taxes   138,492       136,458       220,063       428,298  
Provision for income taxes   29,251       32,574       48,707       103,189  
Net income   109,241       103,884       171,356       325,109  
Earnings attributable to noncontrolling interest   12       7       29       (9 )
Net income available to common stockholders $ 109,253     $ 103,891     $ 171,385     $ 325,100  
                               
Basic earnings per common share $ 0.84     $ 0.81     $ 1.33     $ 2.52  
                               
Diluted earnings per common share $ 0.84     $ 0.81     $ 1.32     $ 2.52  

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 September 30, 2020:                                                
Balances – June 30, 2020   $ 1,293     $ 2,257,867     $ 1,788,329     $ 63,177     $ 3,100     $ 4,113,766  
Net income                 109,241                   109,241  
Earnings attributable to noncontrolling
interest
                12             (12 )      
Total other comprehensive loss                       (2,061 )           (2,061 )
Common stock dividends,
$0.2725 per share
                (35,570 )                 (35,570 )
Stock-based compensation expense           3,997                         3,997  
Forfeitures of 8,228 shares of unvested
restricted common stock
                                   
Balances – September 30, 2020   $ 1,293     $ 2,261,864     $ 1,862,012     $ 61,116     $ 3,088     $ 4,189,373  
                                                 
Nine months ended September 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                 171,356                   171,356  
Earnings attributable to noncontrolling
interest
                29             (29 )      
Total other comprehensive income                       33,861             33,861  
Common stock dividends,
$0.8025 per share
                (104,012 )                 (104,012 )
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           11,852                         11,852  
Forfeitures of 45,139 shares of unvested
restricted common stock
                                   
Balances – September 30, 2020   $ 1,293     $ 2,261,864     $ 1,862,012     $ 61,116     $ 3,088     $ 4,189,373  

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 September 30, 2019:                                                
Balances – June 30, 2019   $ 1,289     $ 2,243,779     $ 1,728,486     $ 19,693     $ 3,131     $ 3,996,378  
Net income                 103,884                   103,884  
Earnings attributable to noncontrolling
interest
                7             (7 )      
Total other comprehensive income                       7,955             7,955  
Common stock dividends, $0.24 per share                 (30,963 )                 (30,963 )
Issuance of 10,800 shares of common
stock for exercise of stock options
          242                         242  
Repurchase and cancellation of 974 shares of
common stock
          (28 )                       (28 )
Stock-based compensation expense           3,980                         3,980  
Forfeitures of 10,183 shares of unvested
restricted common stock
                                   
Balances – September 30, 2019   $ 1,289     $ 2,247,973     $ 1,801,414     $ 27,648     $ 3,124     $ 4,081,448  
                                                 
Nine months ended September 30, 2019:                                                
Balances – December 31, 2018   $ 1,286     $ 2,237,948     $ 1,565,201     $ (34,105 )   $ 3,035     $ 3,773,365  
Net income                 325,109                   325,109  
Earnings attributable to noncontrolling
interest
                (9 )           9        
Total other comprehensive income                       61,753             61,753  
Common stock dividends, $0.69 per share                 (88,887 )                 (88,887 )
Noncontrolling interest cash contribution                             80       80  
Issuance of 67,350 shares of common
stock for exercise of stock options
    1       1,118                         1,119  
Issuance of 406,074 shares of unvested
restricted common stock
    4       (4 )                        
Repurchase and cancellation of 63,716
shares of common stock
    (1 )     (1,674 )                       (1,675 )
Stock-based compensation expense           10,584                         10,584  
Forfeiture of 74,398 shares of unvested
restricted common stock
    (1 )     1                          
Balances – September 30, 2019   $ 1,289     $ 2,247,973     $ 1,801,414     $ 27,648     $ 3,124     $ 4,081,448  

Bank OZK
Summary of Non-Interest Expense
Unaudited

    Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
    2020     2019     2020     2019  
    (Dollars in thousands)  
Salaries and employee benefits   $ 53,119     $ 48,376     $ 153,003     $ 140,801  
Net occupancy and equipment     16,676       14,825       47,761       44,163  
Other operating expenses:                                
Professional and outside services     8,647       9,204       23,629       25,874  
Software and data processing     5,431       5,095       15,550       14,561  
Deposit insurance and assessments     3,595       2,505       11,600       9,645  
Telecommunication services     2,352       2,094       6,863       8,248  
Postage and supplies     1,808       2,040       5,753       6,201  
Advertising and public relations     1,557       2,067       4,964       5,421  
ATM expense     1,604       1,277       3,766       3,363  
Travel and meals     689       2,777       3,501       8,385  
Loan collection and repossession expense     1,030       317       2,581       2,218  
Writedowns of foreclosed and other assets     488       354       2,087       1,509  
Amortization of intangibles     1,914       2,907       7,291       9,064  
Other     6,731       7,076       21,670       17,271  
Total non-interest expense   $ 105,641     $ 100,914     $ 310,019     $ 296,724  

Bank OZK
Summary of Total Loans Outstanding
Unaudited

                                 
    September 30, 2020     December 31, 2019  
    (Dollars in thousands)  
Real estate:                                
Residential 1-4 family   $ 966,462       5.0 %   $ 998,632       5.7 %
Non-farm/non-residential     4,415,477       22.8       3,956,579       22.6  
Construction/land development     7,406,447       38.2       6,391,429       36.4  
Agricultural     227,143       1.2       230,076       1.3  
Multifamily residential     1,346,385       7.0       1,194,192       6.8  
Total real estate     14,361,914       74.2       12,770,908       72.8  
Commercial and industrial     944,490       4.9       661,952       3.8  
Consumer     2,581,035       13.3       2,934,534       16.8  
Other     1,471,004       7.6       1,164,649       6.6  
Total loans     19,358,443       100.0 %     17,532,043       100.0 %
Allowance for loan losses     (308,847 )             (108,525 )        
Net loans   $ 19,049,596             $ 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 September 30, 2020:                        
Balances – June 30, 2020   $ 306,196     $ 68,298     $ 374,494  
Net charge-offs     (4,421 )           (4,421 )
Provision for credit losses     7,072       128       7,200  
Balances – September 30, 2020   $ 308,847     $ 68,426     $ 377,273  
                         
Nine months ended September 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     (22,653 )           (22,653 )
Provision for credit losses     183,387       13,502       196,889  
Balances – September 30, 2020   $ 308,847     $ 68,426     $ 377,273  
                         
Three months ended September 30, 2019:                        
Balances – June 30, 2019   $ 106,642     $     $ 106,642  
Net charge-offs     (5,495 )           (5,495 )
Provision for credit losses     7,854             7,854  
Balances – September 30, 2019   $ 109,001     $     $ 109,001  
                         
Nine months ended September 30, 2019:                        
Balances – December 31, 2018   $ 102,264     $     $ 102,264  
Net charge-offs     (14,566 )           (14,566 )
Provision for credit losses     21,303             21,303  
Balances – September 30, 2019   $ 109,001     $     $ 109,001  

Bank OZK
Summary of Deposits – By Account Type
Unaudited

                                 
    September 30, 2020     December 31, 2019  
    (Dollars in thousands)  
Non-interest bearing   $ 3,908,207       18.4 %   $ 2,795,251       15.1 %
Interest bearing:                                
Transaction (NOW)     2,973,192       14.0       2,706,426       14.7  
Savings and money market     4,611,840       21.7       5,601,181       30.3  
Time deposits less than $100     3,483,557       16.4       3,321,446       18.0  
Time deposits of $100 or more     6,310,609       29.5       4,049,955       21.9  
Total deposits   $ 21,287,405       100.0 %   $ 18,474,259       100.0 %

Summary of Deposits – By Customer Type
Unaudited

       
    September 30, 2020     December 31, 2019  
    (Dollars in thousands)  
Consumer   $ 10,909,452       51.2 %   $ 7,526,014       40.7 %
Commercial     5,963,072       28.0       4,334,366       23.5  
Public Funds     2,330,726       10.9       3,782,415       20.5  
Brokered     1,580,165       7.4       2,115,193       11.4  
Reciprocal     503,990       2.5       716,271       3.9  
Total deposits   $ 21,287,405       100.0 %   $ 18,474,259       100.0 %

Bank OZK
Selected Consolidated Financial Data
Unaudited

    Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
    2020     2019     % Change     2020     2019     % Change  
    (Dollars in thousands, except per share amounts)  
Income statement data:                                                
Net interest income   $ 224,657     $ 218,780       2.7 %   $ 651,024     $ 669,204       (2.7 )%
Provision for credit losses     7,200       7,854       (8.3 )     196,889       21,303       824.2  
Non-interest income     26,676       26,446       0.9       75,947       77,121       (1.5 )
Non-interest expense     105,641       100,914       4.7       310,019       296,724       4.5  
Net income available to common stockholders     109,253       103,891       5.2       171,385       325,100       (47.3 )
Pre-tax pre-provision net revenue (1)     145,692       144,312       1.0       416,952       449,601       (7.3 )
Common share and per common share data:                                                
Net income per share − diluted   $ 0.84     $ 0.81       3.7 %   $ 1.32     $ 2.52       (47.6 )%
Net income per share − basic     0.84       0.81       3.7       1.33       2.52       (47.2 )
Dividends per share     0.2725       0.24       13.5       0.8025       0.69       16.3  
Book value per share     32.37       31.63       2.3       32.37       31.63       2.3  
Tangible book value per share(1)     27.13       26.30       3.2       27.13       26.30       3.2  
Weighted-average diluted shares outstanding (thousands)     129,470       129,012               129,398       128,995          
End of period shares outstanding (thousands)     129,342       128,946               129,342       128,946          
Balance sheet data at period end:                                                
Total assets   $ 26,888,308     $ 23,402,679       14.9 %   $ 26,888,308     $ 23,402,679       14.9 %
Total loans     19,358,443       17,734,851       9.2       19,358,443       17,734,851       9.2  
Non-purchased loans     18,419,958       16,307,621       13.0       18,419,958       16,307,621       13.0  
Purchased loans     938,485       1,427,230       (34.2 )     938,485       1,427,230       (34.2 )
Allowance for loan losses     308,847       109,001       183.3       308,847       109,001       183.3  
Foreclosed assets     16,543       33,319       (50.3 )     16,543       33,319       (50.3 )
Investment securities − AFS     3,468,243       2,414,722       43.6       3,468,243       2,414,722       43.6  
Goodwill and other intangible assets, net     677,251       687,397       (1.5 )     677,251       687,397       (1.5 )
Deposits     21,287,405       18,440,078       15.4       21,287,405       18,440,078       15.4  
Other borrowings     750,949       301,421       149.1       750,949       301,421       149.1  
Subordinated notes     223,950       223,567       0.2       223,950       223,567       0.2  
Subordinated debentures     120,335       119,775       0.5       120,335       119,775       0.5  
Unfunded balance of closed loans     11,604,614       11,429,918       1.5       11,604,614       11,429,918       1.5  
Reserve for losses on unfunded loan commitments     68,426           NM       68,426           NM  
Total common stockholders’ equity     4,186,285       4,078,324       2.6       4,186,285       4,078,324       2.6  
Net unrealized gains on investment securities AFS
included in common stockholders' equity
    61,116       27,648               61,116       27,648          
Loan (including purchased loans) to deposit ratio     90.94 %     96.18 %             90.94 %     96.18 %        
Selected ratios:                                                
Return on average assets(2)     1.63 %     1.81 %             0.90 %     1.92 %        
Return on average common stockholders’ equity(2)     10.48       10.22               5.55       11.07          
Return on average tangible common stockholders’ equity(1) (2)     12.52       12.33               6.65       13.44          
Average common equity to total average assets     15.56       17.69               16.23       17.31          
Net interest margin – FTE(2)     3.69       4.26               3.79       4.41          
Efficiency ratio     41.77       40.98               42.38       39.58          
Net charge-offs to average non-purchased loans(2) (3)     0.09       0.07               0.07       0.08          
Net charge-offs to average total loans(2)     0.09       0.12               0.16       0.11          
Nonperforming loans to total loans(4)     0.15       0.17               0.15       0.17          
Nonperforming assets to total assets(4)     0.17       0.26               0.17       0.26          
Allowance for loan losses to total loans (5)     1.60       0.61               1.60     0.61          
Other information:                                                
Non-accrual loans(4)   $ 27,181     $ 25,552             $ 27,181     $ 25,552          
Accruing loans − 90 days past due(4)                                        
Troubled and restructured non-purchased loans − accruing(4)     1,251       1,510               1,251       1,510          

 

(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  
    September 30,     June 30,          
    2020     2020     % Change  
  (Dollars in thousands, except per share amounts)  
Income statement data:                        
Net interest income   $ 224,657     $ 216,593       3.7 %
Provision for credit losses     7,200       72,026       (90.0 )
Non-interest income     26,676       21,591       23.6  
Non-interest expense     105,641       100,953       4.6  
Net income available to common stockholders     109,253       50,266       117.3  
Pre-tax pre-provision net revenue(1)     145,692       137,231       6.2  
Common share and per common share data:                        
Net income per share − diluted   $ 0.84     $ 0.39       115.4 %
Net income per share − basic     0.84       0.39       115.4  
Dividends per share     0.2725       0.27       0.9  
Book value per share     32.37       31.78       1.9  
Tangible book value per share (1)     27.13       26.53       2.3  
Weighted-average diluted shares outstanding (thousands)     129,470       129,399          
End of period shares outstanding (thousands)     129,342       129,350          
Balance sheet data at period end:                        
Total assets   $ 26,888,308     $ 26,380,409       1.9 %
Total loans     19,358,443       19,311,078       0.2  
Non-purchased loans     18,419,958       18,247,431       0.9  
Purchased loans     938,485       1,063,647       (11.8 )
Allowance for loan losses     308,847       306,196       0.9  
Foreclosed assets     16,543       18,328       (9.7 )
Investment securities − AFS     3,468,243       3,299,944       5.1  
Goodwill and other intangible assets, net     677,251       679,166       (0.3 )
Deposits     21,287,405       20,723,598       2.7  
Other borrowings     750,949       903,696       (16.9 )
Subordinated notes     223,950       223,854       0.1  
Subordinated debentures     120,335       120,194       0.1  
Unfunded balance of closed loans     11,604,614       11,411,441       1.7  
Reserve for losses on unfunded loan commitments     68,426       68,298       0.2  
Total common stockholders’ equity     4,186,285       4,110,666       1.8  
Net unrealized gains on investment securities AFS
included in common stockholders' equity
    61,116       63,177          
Loan (including purchased loans) to deposit ratio     90.94 %     93.18 %        
Selected ratios:                        
Return on average assets(2)     1.63 %     0.78 %        
Return on average common stockholders’ equity(2)     10.48       4.92          
Return on average tangible common stockholders’ equity(1) (2)     12.52       5.89          
Average common equity to total average assets     15.56       15.93          
Net interest margin – FTE(2)     3.69       3.74          
Efficiency ratio     41.77       42.07          
Net charge-offs to average non-purchased loans(2) (3)     0.09       0.05          
Net charge-offs to average total loans(2)     0.09       0.29          
Nonperforming loans to total loans(4)     0.15       0.18          
Nonperforming assets to total assets(4)     0.17       0.19          
Allowance for loan losses to total loans (5)     1.60       1.59          
Other information:                        
Non-accrual loans(4)   $ 27,181     $ 31,083          
Accruing loans − 90 days past due(4)                    
Troubled and restructured non-purchased loans − accruing(4)     1,251       934          

(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.
 

Bank OZK
Supplemental Quarterly Financial Data
Unaudited

    12/31/18     3/31/19     6/30/19     9/30/19     12/31/19     3/31/20     6/30/20     9/30/20  
    (Dollars in thousands, except per share amounts)  
Earnings Summary:                                                                
Net interest income   $ 228,382     $ 225,888     $ 224,536     $ 218,780     $ 214,977     $ 209,775     $ 216,593     $ 224,657  
Federal tax (FTE) adjustment     1,219       1,207       1,136       1,038       1,028       1,133       1,753       1,605  
Net interest income (FTE)     229,601       227,095       225,672       219,818       216,005       210,908       218,346       226,262  
Provision for credit losses     (7,271 )     (6,681 )     (6,769 )     (7,854 )     (4,938 )     (117,663 )     (72,026 )     (7,200 )
Non-interest income     27,560       24,072       26,603       26,446       30,406       27,680       21,591       26,676  
Non-interest expense     (94,893 )     (96,678 )     (99,131 )     (100,914 )     (104,406 )     (103,425 )     (100,953 )     (105,641 )
Pretax income (FTE)     154,997       147,808       146,375       137,496       137,067       17,500       66,958       140,097  
FTE adjustment     (1,219 )     (1,207 )     (1,136 )     (1,038 )     (1,028 )     (1,133 )     (1,753 )     (1,605 )
Provision for income taxes     (38,750 )     (35,889 )     (34,726 )     (32,574 )     (35,240 )     (4,509 )     (14,948 )     (29,251 )
Noncontrolling interest     3       (6 )     (10 )     7       7       8       9       12  
Net income available to common stockholders   $ 115,031     $ 110,706     $ 110,503     $ 103,891     $ 100,806     $ 11,866     $ 50,266     $ 109,253  
Earnings per common share – diluted   $ 0.89     $ 0.86     $ 0.86     $ 0.81     $ 0.78     $ 0.09     $ 0.39     $ 0.84  
Non-interest Income:                                                                
Service charges on deposit accounts   $ 10,585     $ 9,722     $ 10,291     $ 10,827     $ 10,933     $ 10,009     $ 8,281     $ 9,427  
Trust income     1,821       1,730       1,839       1,975       2,010       1,939       1,759       1,936  
BOLI income:                                                                
Increase in cash surrender value     5,269       5,162       5,178       5,208       5,167       5,067       5,057       5,081  
Death benefits     482                   206       2,989       608              
Loan service, maintenance and other fees     5,245       4,874       4,565       4,197       4,282       3,716       3,394       3,351  
Other income from purchased loans     2,370       795       1,455       674       759                    
Gains on sales of other assets     465       284       402       189       1,358       161       621       891  
Net gains on investment securities                 713                   2,223             2,244  
Other     1,323       1,505       2,160       3,170       2,908       3,957       2,479       3,746  
Total non-interest income   $ 27,560     $ 24,072     $ 26,603     $ 26,446     $ 30,406     $ 27,680     $ 21,591     $ 26,676  
Non-interest Expense:                                                                
Salaries and employee benefits   $ 41,837     $ 44,868     $ 47,558     $ 48,376     $ 52,050     $ 51,473     $ 48,410     $ 53,119  
Net occupancy and equipment     14,027       14,750       14,587       14,825       14,855       15,330       15,756       16,676  
Other operating expenses     39,029       37,060       36,986       37,713       37,501       36,622       36,787       35,846  
Total non-interest expense   $ 94,893     $ 96,678     $ 99,131     $ 100,914     $ 104,406     $ 103,425     $ 100,953     $ 105,641  
Balance Sheet Data:                                                                
Total assets   $ 22,388,030     $ 23,005,652     $ 22,960,731     $ 23,402,679     $ 23,555,728     $ 24,565,810     $ 26,380,409     $ 26,888,308  
Non-purchased loans     15,073,791       15,610,681       15,786,809       16,307,621       16,224,539       17,030,378       18,247,431       18,419,958  
Purchased loans     2,044,032       1,864,715       1,698,396       1,427,230       1,307,504       1,197,826       1,063,647       938,485  
Investment securities – AFS     2,862,340       2,769,602       2,548,489       2,414,722       2,277,389       2,816,556       3,299,944       3,468,243  
Deposits     17,938,415       18,476,868       18,186,215       18,440,078       18,474,259       18,809,190       20,723,598       21,287,405  
Unfunded balance of closed loans     11,364,975       11,544,218       11,167,055       11,429,918       11,325,598       11,334,737       11,411,441       11,604,614  
Common stockholders' equity     3,770,330       3,882,643       3,993,247       4,078,324       4,150,351       4,083,150       4,110,666       4,186,285  

Bank OZK
Supplemental Quarterly Financial Data (Continued)
Unaudited

    12/31/18     3/31/19     6/30/19     9/30/19     12/31/19     3/31/20     6/30/20     9/30/20  
    (Dollars in thousands, except per share amounts)  
Allowance for Credit Losses:                                                                
Balance at beginning of period   $ 98,200     $ 102,264     $ 105,954     $ 106,642     $ 109,001     $ 108,525     $ 316,409     $ 374,494  
Adoption of CECL(1) methodology                                   94,512              
Net charge-offs     (3,207 )     (2,991 )     (6,081 )     (5,495 )     (5,414 )     (4,291 )     (13,941 )     (4,421 )
Provision for credit losses     7,271       6,681       6,769       7,854       4,938       117,663       72,026       7,200  
Balance at end of period   $ 102,264     $ 105,954     $ 106,642     $ 109,001     $ 108,525     $ 316,409     $ 374,494     $ 377,273  
Allowance for loan losses   $ 102,264     $ 105,954     $ 106,642     $ 109,001     $ 108,525     $ 238,737     $ 306,196     $ 308,847  
Reserve for losses on unfunded loan commitments                                   77,672       68,298       68,426  
Total allowance for credit losses   $ 102,264     $ 105,954     $ 106,642     $ 109,001     $ 108,525     $ 316,409     $ 374,494     $ 377,273  
Selected Ratios:                                                                
Net interest margin – FTE(2)     4.55 %     4.53 %     4.45 %     4.26 %     4.15 %     3.96 %     3.74 %     3.69 %
Efficiency ratio     36.90       38.49       39.30       40.98       42.37       43.35       42.07       41.77  
Net charge-offs to average non-purchased loans(2) (3)     0.06       0.05       0.12       0.07       0.10       0.08       0.05       0.09  
Net charge-offs to average total loans(2)     0.07       0.07       0.14       0.12       0.12       0.10       0.29       0.09  
Nonperforming loans to total loans(4)     0.23       0.22       0.15       0.17       0.15       0.16       0.18       0.15  
Nonperforming assets to total assets(4)     0.23       0.21       0.25       0.26       0.18       0.19       0.19       0.17  
Allowance for loan losses to total loans (5)     0.60       0.61       0.61       0.61       0.62       1.31       1.59       1.60  
Loans past due 30 days or more, including
past due non-accrual loans, to total loans(4)
    0.28       0.28       0.13       0.14       0.19       0.18       0.13       0.13  

(1)  Current Expected Credit Loss.

(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.
 

Bank OZK
Average Consolidated Balance Sheets and Net Interest Analysis – FTE
Unaudited

     Three Months Ended September 30,     Nine Months Ended September 30,  
    2020     2019     2020     2019  
    Average
Balance
    Income/
Expense
    Yield/
Rate
    Average
Balance
    Income/
Expense
    Yield/
Rate
    Average
Balance
    Income/
Expense
    Yield/
Rate
    Average
Balance
    Income/
Expense
    Yield/
Rate
 
    (Dollars in thousands)  
ASSETS                                                                                                
Earning assets:                                                                                                
Interest earning deposits and federal
funds sold
  $ 1,705,652     $ 532       0.12 %   $ 486,174     $ 2,647       2.16 %   $ 1,459,814     $ 5,237       0.48 %   $ 242,476     $ 4,001       2.21 %
Investment securities:                                                                                                
Taxable     2,216,041       9,666       1.74       2,027,267       12,511       2.45       1,979,368       31,480       2.12       2,169,218       40,992       2.53  
Tax-exempt – FTE     1,193,407       6,573       2.19       462,927       4,256       3.65       944,552       18,527       2.62       495,694       13,835       3.73  
Non-purchased loans – FTE     18,311,166       236,846       5.15       15,934,033       245,099       6.10       17,602,817       701,892       5.33       15,727,447       741,375       6.30  
Purchased loans     999,438       16,269       6.48       1,553,398       26,042       6.65       1,132,334       54,743       6.46       1,760,740       84,756       6.44  
Total earning assets – FTE     24,425,704       269,886       4.40       20,463,799       290,555       5.63       23,118,885       811,879       4.69       20,395,575       884,959       5.80  
Non-interest earning assets     2,235,853                       2,323,028                       2,302,225                       2,277,584                  
Total assets   $ 26,661,557                     $ 22,786,827                     $ 25,421,110                     $ 22,673,159                  
LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                
Interest bearing liabilities:                                                                                                
Deposits:                                                                                                
Savings and interest bearing
transaction
  $ 7,581,707     $ 5,496       0.29 %   $ 8,792,998     $ 30,108       1.36 %   $ 7,742,865     $ 32,945       0.57 %   $ 9,318,915     $ 103,721       1.49 %
Time deposits of $100 or more     6,101,542       20,858       1.36       3,564,862       19,803       2.20       5,259,616       66,813       1.70       3,292,375       52,056       2.11  
Other time deposits     3,664,931       11,919       1.29       3,069,997       16,337       2.11       3,584,047       41,448       1.54       2,697,660       40,950       2.03  
Total interest bearing deposits     17,348,180       38,273       0.88       15,427,857       66,248       1.70       16,586,528       141,206       1.14       15,308,950       196,727       1.72  
Repurchase agreements with customers     7,093       4       0.24       9,037       5       0.24       7,686       17       0.29       14,062       39       0.37  
Other borrowings (1)     793,350       1,156       0.58       29,422       90       1.21       711,408       2,168       0.41       122,254       1,497       1.64  
Subordinated notes     223,899       3,207       5.70       223,516       3,216       5.71       223,801       9,551       5.70       223,419       9,542       5.71  
Subordinated debentures (1)     120,253       984       3.26       119,700       1,178       3.90       120,119       3,420       3.80       119,558       4,570       5.11  
Total interest bearing liabilities     18,492,775       43,624       0.94       15,809,532       70,737       1.78       17,649,542       156,362       1.18       15,788,243       212,375       1.80  
Non-interest bearing liabilities:                                                                                                
Non-interest bearing deposits     3,764,063                       2,728,596                       3,391,162                       2,736,350                  
Other non-interest bearing liabilities     253,211                       213,505                       251,723                       220,126                  
Total liabilities     22,510,049                       18,751,633                       21,292,427                       18,744,719                  
Common stockholders’ equity     4,148,409                       4,032,066                       4,125,578                       3,925,321                  
Noncontrolling interest     3,099                       3,128                       3,105                       3,119                  
Total liabilities and stockholders’
equity
  $ 26,661,557                     $ 22,786,827                     $ 25,421,110                     $ 22,673,159                  
Net interest income – FTE           $ 226,262                     $ 219,818                     $ 655,517                     $ 672,584          
Net interest margin – FTE                     3.69 %                     4.26 %                     3.79 %                     4.41 %

(1)   The interest expense and the rates for “other borrowings” and for “subordinated debentures” were affected by capitalized interest. Capitalized interest included in other borrowings totaled $0.03 million for the third quarter and $0.65 million for the first nine months of 2020 compared to $0.11 million for the third quarter and $0.86 million for the first nine months of 2019. In the absence of this interest capitalization, the rates on other borrowings would have been 0.59% for the third quarter and 0.53% for the first nine months of 2020 and 2.69% for the third quarter and 2.57% for the first nine months of 2019. Capitalized interest included in subordinated debentures totaled $0.01 million for the third quarter and $0.18 million for the first nine months of 2020, compared to $0.45 million for both the third quarter and first nine months of 2019. In the absence of this interest capitalization, the rates on subordinated debentures would have been 3.27% for the third quarter and 4.00% for the first nine months of 2020 and 5.39% for the third quarter and 5.61% for the first nine months of 2019.
 

Bank OZK
Reconciliation of Non-GAAP Financial Measures

Calculation of Average Tangible Common Stockholders’ Equity
and the Annualized Return on Average Tangible Common Stockholders’ Equity
Unaudited

                                         
    Three Months Ended     Nine Months Ended  
    September 30,     June 30,     September 30,  
    2020     2019     2020     2020     2019  
    (Dollars in thousands)  
Net income available to common stockholders   $ 109,253     $ 103,891     $ 50,266     $ 171,385     $ 325,100  
Average common stockholders’ equity before
noncontrolling interest
  $ 4,148,409     $ 4,032,066     $ 4,110,038     $ 4,125,578     $ 3,925,321  
Less average intangible assets:                                        
Goodwill     (660,789 )     (660,789 )     (660,789 )     (660,789 )     (660,789 )
Core deposit and other intangible assets, net of
accumulated amortization
    (17,461 )     (28,275 )     (19,563 )     (19,803 )     (31,290 )
Total average intangibles     (678,250 )     (689,064 )     (680,352 )     (680,592 )     (692,079 )
Average tangible common stockholders’ equity   $ 3,470,159     $ 3,343,002     $ 3,429,686     $ 3,444,986     $ 3,233,242  
Return on average common stockholders’ equity(1)     10.48 %     10.22 %     4.92 %     5.55 %     11.07 %
Return on average tangible common stockholders’ equity(1)     12.52 %     12.33 %     5.89 %     6.65 %     13.44 %

(1) Ratios for interim periods annualized based on actual days.

Calculation of Total Tangible Common Stockholders’ Equity
and Tangible Book Value per Common Share
Unaudited

     September 30,     June 30,  
    2020     2019     2020  
    (In thousands, except per share amounts)  
Total common stockholders’ equity before noncontrolling interest   $ 4,186,285     $ 4,078,324     $ 4,110,666  
Less intangible assets:                        
Goodwill     (660,789 )     (660,789 )     (660,789 )
Core deposit and other intangible assets, net of accumulated
amortization
    (16,462 )     (26,608 )     (18,377 )
Total intangibles     (677,251 )     (687,397 )     (679,166 )
Total tangible common stockholders' equity   $ 3,509,034     $ 3,390,927     $ 3,431,500  
Shares of common stock outstanding     129,342       128,946       129,350  
Book value per common share   $ 32.37     $ 31.63     $ 31.78  
Tangible book value per common share   $ 27.13     $ 26.30     $ 26.53  

Calculation of Total Tangible Common Stockholders’ Equity
and the Ratio of Total Tangible Common Stockholders’ Equity
to Total Tangible Assets
Unaudited

     September 30,  
    2020     2019  
    (Dollars in thousands)  
Total common stockholders’ equity before noncontrolling interest   $ 4,186,285     $ 4,078,324  
Less intangible assets:                
Goodwill     (660,789 )     (660,789 )
Core deposit and other intangible assets, net of accumulated amortization     (16,462 )     (26,608 )
Total intangibles     (677,251 )     (687,397 )
Total tangible common stockholders' equity   $ 3,509,034     $ 3,390,927  
Total assets   $ 26,888,308     $ 23,402,679  
Less intangible assets:                
Goodwill     (660,789 )     (660,789 )
Core deposit and other intangible assets, net of accumulated amortization     (16,462 )     (26,608 )
Total intangibles     (677,251 )     (687,397 )
Total tangible assets   $ 26,211,057     $ 22,715,282  
Ratio of total common stockholders’ equity to total assets     15.57 %     17.43 %
Ratio of total tangible common stockholders’ equity to total
tangible assets
    13.39 %     14.93 %

Calculation of Pre-Tax Pre-Provision Net Revenue

Unaudited

    Three Months Ended     Nine Months Ended  
    September 30,     June 30,     September 30,  
    2020     2019     2020     2020     2019  
    (Dollars in thousands)  
Income before taxes   $ 138,492     $ 136,458     $ 65,205     $ 220,063     $ 428,298  
Provision for credit losses     7,200       7,854       72,026       196,889       21,303  
Pre-tax pre-provision net revenue   $ 145,692     $ 144,312     $ 137,231     $ 416,952     $ 449,601  

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Source: Bank OZK