Press Release

Bank OZK Announces Fourth Quarter and Full Year 2020 Earnings

Company Release - 1/21/2021 4:01 PM ET

LITTLE ROCK, Ark., Jan. 21, 2021 (GLOBE NEWSWIRE) -- Bank OZK (the “Bank”) (Nasdaq: OZK) today announced that net income for the fourth quarter of 2020 was $120.5 million, a 19.5% increase from $100.8 million for the fourth quarter of 2019. Diluted earnings per common share for the fourth quarter of 2020 were $0.93, a 19.2% increase from $0.78 for the fourth quarter of 2019.

For the full year of 2020, net income was $291.9 million, a 31.5% decrease from $425.9 million for the full year of 2019. Diluted earnings per common share for the full year of 2020 were $2.26, a 31.5% decrease from $3.30 for the full year of 2019.

Pre-tax pre-provision net revenue (“PPNR”) was $162.9 million for the fourth quarter of 2020, a 15.5% increase from $141.0 million for the fourth quarter of 2019. PPNR was $579.8 million for the full year of 2020, a 1.8% decrease from $590.6 million for the full year 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 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 significant provision for credit losses in the first and second quarters of 2020. The Bank’s provision for credit losses was $203.6 million for the full year of 2020, and the Bank’s ACL was $377.3 million at December 31, 2020.

The Bank’s annualized returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the fourth quarter of 2020 were 1.79%, 11.36% and 13.53%, respectively, compared to 1.74%, 9.73% and 11.68%, respectively, for the fourth quarter of 2019. The Bank’s returns on average assets, average common stockholder’s equity and average tangible common stockholders’ equity for the full year of 2020 were 1.13%, 7.04% and 8.41%, respectively, compared to 1.87%, 10.72%, and 12.98%, respectively, for the full year 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, “We are pleased to report one of our best quarters ever, highlighted by record quarterly net interest income, our second highest quarterly net income in company history, excellent asset quality and an efficiency ratio among the best in the industry.  It was a strong finish to a challenging year. Our strong capital and liquidity, our disciplined credit culture and our exceptional team have us well positioned for the future.”

KEY BALANCE SHEET METRICS

Total loans were $19.21 billion at December 31, 2020, a 9.6% increase from $17.53 billion at December 31, 2019, but a 0.8% decrease from $19.36 billion at September 30, 2020. Non-purchased loans were $18.40 billion at December 31, 2020, a 13.4% increase from $16.22 billion at December 31, 2019, but a 0.1% decrease from $18.42 billion at September 30, 2020.  Purchased loans, which consist of loans acquired in previous acquisitions, were $0.81 billion at December 31, 2020, a 38.2% decrease from $1.31 billion at December 31, 2019.

Deposits were $21.45 billion at December 31, 2020, a 16.1% increase from $18.47 billion at December 31, 2019. Total assets were $27.16 billion at December 31, 2020, a 15.3% increase from $23.56 billion at December 31, 2019.

Common stockholders’ equity was $4.27 billion at December 31, 2020, a 2.9% increase from $4.15 billion at December 31, 2019. Tangible common stockholders’ equity was $3.60 billion at December 31, 2020, a 3.8% increase from $3.47 billion at December 31, 2019. Book value per common share was $33.03 at December 31, 2020, a 2.6% increase from $32.19 at December 31, 2019. Tangible book value per common share was $27.81 at December 31, 2020, a 3.5% increase from $26.88 at December 31, 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 15.73% at December 31, 2020 compared to 17.62% at December 31, 2019. Its ratio of total tangible common stockholders’ equity to total tangible assets was 13.59% at December 31, 2020 compared to 15.15% at December 31, 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 January 22, 2021. 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 7995612. 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 or 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, and they are not 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 COVID-19 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 ACL 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 evolving nature of the COVID-19 pandemic.

If the health, logistical or economic effects of the COVID-19 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 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 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 COVID-19 pandemic such as the Coronavirus Aid, Relief and Economic Security Act, the Consolidated Appropriations Act of 2021 and any similar or related rules and regulations; changes in U.S. Government monetary and fiscal policy, including any changes that result from the recent U.S. elections; 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 Bank’s staff, the global economy and financial markets; national, 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. Headquartered in Little Rock, Arkansas, Bank OZK conducts operations through more than 250 branches, loan production offices and other offices in Arkansas, Georgia, Florida, North Carolina, South Carolina, Texas, 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

  December 31,  
  2020     2019  
           
  (Dollars in thousands, except per share amounts)  
ASSETS              
Cash and cash equivalents $ 2,393,662     $ 1,495,757  
Investment securities ― available for sale ("AFS")   3,405,351       2,277,389  
Federal Home Loan Bank of Dallas and other bankers' bank stocks   38,486       21,855  
Non-purchased loans   18,401,495       16,224,539  
Purchased loans   807,673       1,307,504  
Allowance for loan losses   (295,824 )     (108,525 )
Net loans   18,913,344       17,423,518  
Premises and equipment, net   738,842       711,541  
Foreclosed assets   11,085       19,096  
Accrued interest receivable   88,077       75,208  
Bank owned life insurance (“BOLI”)   758,071       738,860  
Goodwill and other intangible assets, net   675,458       684,542  
Other, net   140,220       107,962  
Total assets $ 27,162,596     $ 23,555,728  
               
LIABILITIES AND STOCKHOLDERS’ EQUITY              
Deposits:              
Demand non-interest bearing $ 3,996,546     $ 2,795,251  
Savings and interest bearing transaction   8,160,982       8,307,607  
Time   9,292,828       7,371,401  
Total deposits   21,450,356       18,474,259  
Repurchase agreements with customers   8,013       11,249  
Other borrowings   750,928       351,387  
Subordinated notes   224,047       223,663  
Subordinated debentures   120,475       119,916  
Reserve for losses on unfunded loan commitments   81,481        
Accrued interest payable and other liabilities   251,940       221,786  
Total liabilities   22,887,240       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 December 31, 2020 or 2019
         
Common stock; $0.01 par value; 300,000,000 shares authorized;
129,350,448 and 128,951,024 shares issued and outstanding at
December 31, 2020 and 2019, respectively
  1,294       1,289  
Additional paid-in capital   2,265,850       2,251,824  
Retained earnings   1,946,875       1,869,983  
Accumulated other comprehensive income   58,252       27,255  
Total stockholders’ equity before noncontrolling interest   4,272,271       4,150,351  
Noncontrolling interest   3,085       3,117  
Total stockholders’ equity   4,275,356       4,153,468  
Total liabilities and stockholders’ equity $ 27,162,596     $ 23,555,728  
               

Bank OZK
Consolidated Statements of Income
Unaudited

  Three Months Ended     Year Ended  
  December 31,     December 31,  
  2020     2019     2020     2019  
                       
  (Dollars in thousands, except per share amounts)  
Interest income:                              
Non-purchased loans $ 243,064     $ 240,912     $ 944,354     $ 981,811  
Purchased loans   16,069       22,152       70,812       106,908  
Investment securities:                              
Taxable   9,066       11,820       40,547       52,812  
Tax-exempt   4,767       3,323       19,403       14,252  
Deposits with banks and federal funds sold   428       2,756       5,665       6,758  
Total interest income   273,394       280,963       1,080,781       1,162,541  
                               
Interest expense:                              
Deposits   30,607       61,631       171,813       258,358  
Repurchase agreements with customers   6       11       23       50  
Other borrowings   1,011       34       3,179       1,531  
Subordinated notes   3,207       3,216       12,758       12,757  
Subordinated debentures   963       1,094       4,384       5,664  
Total interest expense   35,794       65,986       192,157       278,360  
                               
Net interest income   237,600       214,977       888,624       884,181  
Provision for credit losses   6,750       4,938       203,639       26,241  
Net interest income after provision for credit losses   230,850       210,039       684,985       857,940  
                               
Non-interest income:                              
Service charges on deposit accounts   9,983       10,933       37,699       41,774  
Trust income   1,909       2,010       7,544       7,554  
BOLI income:                              
Increase in cash surrender value   5,034       5,167       20,239       20,715  
Death benefits         2,989       608       3,194  
Loan service, maintenance and other fees   3,797       4,282       14,257       17,917  
Other income from purchased loans         759             3,684  
Gains on sales of other assets   5,189       1,358       6,863       2,233  
Net gains on investment securities               4,467       713  
Other   2,749       2,908       12,931       9,743  
Total non-interest income   28,661       30,406       104,608       107,527  
                               
Non-interest expense:                              
Salaries and employee benefits   53,832       52,050       206,834       192,851  
Net occupancy and equipment   15,617       14,855       63,379       59,018  
Other operating expenses   33,945       37,501       143,200       149,261  
Total non-interest expense   103,394       104,406       413,413       401,130  
                               
Income before taxes   156,117       136,039       376,180       564,337  
Provision for income taxes   35,607       35,240       84,314       138,429  
Net income   120,510       100,799       291,866       425,908  
Earnings attributable to noncontrolling interest   3       7       32       (2 )
Net income available to common stockholders $ 120,513     $ 100,806     $ 291,898     $ 425,906  
                               
Basic earnings per common share $ 0.93     $ 0.78     $ 2.26     $ 3.30  
                               
Diluted earnings per common share $ 0.93     $ 0.78     $ 2.26     $ 3.30  
                               

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 December 31, 2020:                                              
Balances – September 30, 2020 $ 1,293     $ 2,261,864     $ 1,862,012     $ 61,116     $ 3,088     $ 4,189,373  
Net income               120,510                   120,510  
Earnings attributable to noncontrolling
interest
              3             (3 )      
Total other comprehensive loss                     (2,864 )           (2,864 )
Common stock dividends,
$0.275 per share
              (35,650 )                 (35,650 )
Issuance of 39,900 shares of common
stock for exercise of stock options
        991                         991  
Stock-based compensation expense         2,996                         2,996  
Forfeitures of 31,525 shares of unvested
restricted common stock
  1       (1 )                        
Balances – December 31, 2020 $ 1,294     $ 2,265,850     $ 1,946,875     $ 58,252     $ 3,085     $ 4,275,356  
                                               
Year ended December 31, 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               291,866                   291,866  
Earnings attributable to noncontrolling
interest
              32             (32 )      
Total other comprehensive income                     30,997             30,997  
Common stock dividends,
$1.0775 per share
              (139,662 )                 (139,662 )
Issuance of 44,200 shares of common
stock for exercise of stock options
        1,036                         1,036  
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         14,848                         14,848  
Forfeitures of 76,664 shares of unvested
restricted common stock
  1       (1 )                        
Balances – December 31, 2020 $ 1,294     $ 2,265,850     $ 1,946,875     $ 58,252     $ 3,085     $ 4,275,356  
                                               

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 December 31, 2019:                                              
Balances – September 30, 2019 $ 1,289     $ 2,247,973     $ 1,801,414     $ 27,648     $ 3,124     $ 4,081,448  
Net income               100,799                   100,799  
Earnings attributable to noncontrolling interest               7             (7 )      
Total other comprehensive loss                     (393 )           (393 )
Common stock dividends, $0.25 per
share
              (32,237 )                 (32,237 )
Issuance of 16,150 shares of common
stock for exercise of stock options
        266                         266  
Stock-based compensation expense         3,585                         3,585  
Forfeitures of 11,485 shares of unvested
restricted common stock
                                 
Balances – December 31, 2019 $ 1,289     $ 2,251,824     $ 1,869,983     $ 27,255     $ 3,117     $ 4,153,468  
                                               
Year ended December 31, 2019:                                              
Balances – December 31, 2018 $ 1,286     $ 2,237,948     $ 1,565,201     $ (34,105 )   $ 3,035     $ 3,773,365  
Net income               425,908                   425,908  
Earnings attributable to noncontrolling
interest
              (2 )           2        
Total other comprehensive income                     61,360             61,360  
Common stock dividends, $0.94
per share
              (121,124 )                 (121,124 )
Noncontrolling interest cash contribution                           80       80  
Issuance of 83,500 shares of common
stock for exercise of stock options
  1       1,384                         1,385  
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         14,169                         14,169  
Forfeiture of 85,883 shares of unvested
restricted common stock
  (1 )     1                          
Balances – December 31, 2019 $ 1,289     $ 2,251,824     $ 1,869,983     $ 27,255     $ 3,117     $ 4,153,468  
                                               

Bank OZK
Summary of Non-Interest Expense
Unaudited

  Three Months Ended     Year Ended  
  December 31,     December 31,  
  2020     2019     2020     2019  
                       
  (Dollars in thousands)  
Salaries and employee benefits $ 53,832     $ 52,050     $ 206,834     $ 192,851  
Net occupancy and equipment   15,617       14,855       63,379       59,018  
Other operating expenses:                              
Professional and outside services   7,345       7,156       30,974       33,030  
Software and data processing   5,729       4,974       21,279       19,535  
Deposit insurance and assessments   3,647       3,780       15,247       13,425  
Telecommunication services   2,296       2,335       9,159       10,583  
Postage and supplies   1,709       2,483       7,462       8,684  
Advertising and public relations   1,086       1,822       6,050       7,242  
ATM expense   1,490       1,263       5,256       4,626  
Travel and meals   835       2,845       4,336       11,230  
Loan collection and repossession expense   481       600       3,062       2,818  
Writedowns of foreclosed and other assets   1,582       910       3,669       2,419  
Amortization of intangibles   1,794       2,854       9,085       11,918  
Other   5,951       6,479       27,621       23,751  
Total non-interest expense $ 103,394     $ 104,406     $ 413,413     $ 401,130  
                               

Bank OZK
Summary of Total Loans Outstanding
Unaudited

  December 31,  
  2020     2019  
           
  (Dollars in thousands)  
Real estate:                              
Residential 1-4 family $ 911,115       4.7 %   $ 998,632       5.7 %
Non-farm/non-residential   4,213,636       21.9       3,956,579       22.6  
Construction/land development   8,046,978       41.9       6,391,429       36.4  
Agricultural   204,868       1.1       230,076       1.3  
Multifamily residential   856,297       4.5       1,194,192       6.8  
Total real estate   14,232,894       74.1       12,770,908       72.8  
Commercial and industrial   842,206       4.4       661,952       3.8  
Consumer   2,393,964       12.5       2,934,534       16.8  
Other   1,740,104       9.0       1,164,649       6.6  
Total loans   19,209,168       100.0 %     17,532,043       100.0 %
Allowance for loan losses   (295,824 )             (108,525 )        
Net loans $ 18,913,344             $ 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 December 31, 2020:                      
Balances – September 30, 2020 $ 308,847     $ 68,426     $ 377,273  
Net charge-offs   (6,718 )           (6,718 )
Provision for credit losses   (6,305 )     13,055       6,750  
Balances – December 31, 2020 $ 295,824     $ 81,481     $ 377,305  
                       
Year ended December 31, 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   (29,371 )           (29,371 )
Provision for credit losses   177,082       26,557       203,639  
Balances – December 31, 2020 $ 295,824     $ 81,481     $ 377,305  
                       
Three months ended December 31, 2019:                      
Balances – September 30, 2019 $ 109,001     $     $ 109,001  
Net charge-offs   (5,414 )           (5,414 )
Provision for credit losses   4,938             4,938  
Balances – December 31, 2019 $ 108,525     $     $ 108,525  
                       
Year ended December 31, 2019:                      
Balances – December 31, 2018 $ 102,264     $     $ 102,264  
Net charge-offs   (19,980 )           (19,980 )
Provision for credit losses   26,241             26,241  
Balances – December 31, 2019 $ 108,525     $     $ 108,525  
                       

Bank OZK
Summary of Deposits – By Account Type
Unaudited

  December 31,  
  2020     2019  
           
  (Dollars in thousands)  
Non-interest bearing $ 3,996,546       18.6 %   $ 2,795,251       15.1 %
Interest bearing:                              
Transaction (NOW)   3,124,007       14.6       2,706,426       14.7  
Savings and money market   5,036,975       23.5       5,601,181       30.3  
Time deposits less than $100   3,075,845       14.3       3,321,446       18.0  
Time deposits of $100 or more   6,216,983       29.0       4,049,955       21.9  
Total deposits $ 21,450,356       100.0 %   $ 18,474,259       100.0 %
                               

Summary of Deposits – By Customer Type
Unaudited

  December 31,  
  2020     2019  
           
  (Dollars in thousands)  
Consumer $ 11,165,603       52.1 %   $ 7,526,014       40.7 %
Commercial   6,056,536       28.2       4,334,366       23.5  
Public Funds   2,111,971       9.8       3,782,415       20.5  
Brokered   1,600,116       7.5       2,115,193       11.4  
Reciprocal   516,130       2.4       716,271       3.9  
Total deposits $ 21,450,356       100.0 %   $ 18,474,259       100.0 %
                               

Bank OZK
Selected Consolidated Financial Data
Unaudited

  Three Months Ended     Year Ended  
  December 31,     December 31,  
  2020     2019     % Change     2020     2019     % Change  
                                   
  (Dollars in thousands, except per share amounts)  
Income statement data:                                              
Net interest income $ 237,600     $ 214,977       10.5 %   $ 888,624     $ 884,181       0.5 %
Provision for credit losses   6,750       4,938       36.7       203,639       26,241       676.0  
Non-interest income   28,661       30,406       (5.7 )     104,608       107,527       (2.7 )
Non-interest expense   103,394       104,406       (1.0 )     413,413       401,130       3.1  
Net income available to common stockholders   120,513       100,806       19.5       291,898       425,906       (31.5 )
Pre-tax pre-provision net revenue(1)   162,867       140,977       15.5       579,819       590,578       (1.8 )
Common share and per common share data:                                              
Net income per share − diluted $ 0.93     $ 0.78       19.2 %   $ 2.26     $ 3.30       (31.5 )%
Net income per share − basic   0.93       0.78       19.2       2.26       3.30       (31.5 )
Dividends per share   0.275       0.25       10.0       1.0775       0.94       14.6  
Book value per share   33.03       32.19       2.6       33.03       32.19       2.6  
Tangible book value per share(1)   27.81       26.88       3.5       27.81       26.88       3.5  
Weighted-average diluted shares outstanding (thousands)   129,523       129,036               129,435       129,006          
End of period shares outstanding (thousands)   129,350       128,951               129,350       128,951          
Balance sheet data at period end:                                              
Total assets $ 27,162,596     $ 23,555,728       15.3 %   $ 27,162,596     $ 23,555,728       15.3 %
Total loans   19,209,168       17,532,043       9.6       19,209,168       17,532,043       9.6  
Non-purchased loans   18,401,495       16,224,539       13.4       18,401,495       16,224,539       13.4  
Purchased loans   807,673       1,307,504       (38.2 )     807,673       1,307,504       (38.2 )
Allowance for loan losses   295,824       108,525       172.6       295,824       108,525       172.6  
Foreclosed assets   11,085       19,096       (42.0 )     11,085       19,096       (42.0 )
Investment securities − AFS   3,405,351       2,277,389       49.5       3,405,351       2,277,389       49.5  
Goodwill and other intangible assets, net   675,458       684,542       (1.3 )     675,458       684,542       (1.3 )
Deposits   21,450,356       18,474,259       16.1       21,450,356       18,474,259       16.1  
Other borrowings   750,928       351,387       113.7       750,928       351,387       113.7  
Subordinated notes   224,047       223,663       0.2       224,047       223,663       0.2  
Subordinated debentures   120,475       119,916       0.5       120,475       119,916       0.5  
Unfunded balance of closed loans   11,847,117       11,325,598       4.6       11,847,117       11,325,598       4.6  
Reserve for losses on unfunded loan commitments   81,481           NM       81,481           NM  
Total common stockholders’ equity   4,272,271       4,150,351       2.9       4,272,271       4,150,351       2.9  
Net unrealized gains on investment securities AFS
included in common stockholders' equity
  58,252       27,255               58,252       27,255          
Loan (including purchased loans) to deposit ratio   89.55 %     94.90 %             89.55 %     94.90 %        
Selected ratios:                                              
Return on average assets(2)   1.79 %     1.74 %             1.13 %     1.87 %        
Return on average common stockholders’ equity(2)   11.36       9.73               7.04       10.72          
Return on average tangible common stockholders’ equity(1) (2)   13.53       11.68               8.41       12.98          
Average common equity to total average assets   15.74       17.86               16.10       17.45          
Net interest margin – FTE(2)   3.88       4.15               3.81       4.34          
Efficiency ratio   38.61       42.37               41.37       40.27          
Net charge-offs to average non-purchased loans(2) (3)   0.14       0.10               0.09       0.09          
Net charge-offs to average total loans(2)   0.14       0.12               0.16       0.11          
Nonperforming loans to total loans(4)   0.25       0.15               0.25       0.15          
Nonperforming assets to total assets(4)   0.21       0.18               0.21       0.18          
Allowance for loan losses to total loans(5)   1.54       0.62               1.54     0.62          
Other information:                                              
Non-accrual loans(4) $ 45,162     $ 23,221             $ 45,162     $ 23,221          
Accruing loans − 90 days past due(4)                                      
Troubled and restructured non-purchased loans − accruing(4)   1,483       656               1,483       656          
                                               

 

(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  
  December 31,     September 30,         
  2020     2020     % Change  
                 
  (Dollars in thousands, except per share amounts)  
Income statement data:                      
Net interest income $ 237,600     $ 224,657       5.8 %
Provision for credit losses   6,750       7,200       (6.3 )
Non-interest income   28,661       26,676       7.4  
Non-interest expense   103,394       105,641       (2.1 )
Net income available to common stockholders   120,513       109,253       10.3  
Pre-tax pre-provision net revenue(1)   162,867       145,692       11.8  
Common share and per common share data:                      
Net income per share − diluted $ 0.93     $ 0.84       10.7 %
Net income per share − basic   0.93       0.84       10.7  
Dividends per share   0.275       0.2725       0.9  
Book value per share   33.03       32.37       2.0  
Tangible book value per share(1)   27.81       27.13       2.5  
Weighted-average diluted shares outstanding (thousands)   129,523       129,470          
End of period shares outstanding (thousands)   129,350       129,342          
Balance sheet data at period end:                      
Total assets $ 27,162,596     $ 26,888,308       1.0 %
Total loans   19,209,168       19,358,443       (0.8 )
Non-purchased loans   18,401,495       18,419,958       (0.1 )
Purchased loans   807,673       938,485       (13.9 )
Allowance for loan losses   295,824       308,847       (4.2 )
Foreclosed assets   11,085       16,543       (33.0 )
Investment securities − AFS   3,405,351       3,468,243       (1.8 )
Goodwill and other intangible assets, net   675,458       677,251       (0.3 )
Deposits   21,450,356       21,287,405       0.8  
Other borrowings   750,928       750,949       0.1  
Subordinated notes   224,047       223,950       0.1  
Subordinated debentures   120,475       120,335       0.1  
Unfunded balance of closed loans   11,847,117       11,604,614       2.1  
Reserve for losses on unfunded loan commitments   81,481       68,426       19.1  
Total common stockholders’ equity   4,272,271       4,186,285       2.1  
Net unrealized gains on investment securities AFS
included in common stockholders' equity
  58,252       61,116          
Loan (including purchased loans) to deposit ratio   89.55 %     90.94 %        
Selected ratios:                      
Return on average assets(2)   1.79 %     1.63 %        
Return on average common stockholders’ equity(2)   11.36       10.48          
Return on average tangible common stockholders’ equity(1) (2)   13.53       12.52          
Average common equity to total average assets   15.74       15.56          
Net interest margin – FTE(2)   3.88       3.69          
Efficiency ratio   38.61       41.77          
Net charge-offs to average non-purchased loans(2) (3)   0.14       0.09          
Net charge-offs to average total loans(2)   0.14       0.09          
Nonperforming loans to total loans(4)   0.25       0.15          
Nonperforming assets to total assets(4)   0.21       0.17          
Allowance for loan losses to total loans(5)   1.54       1.60          
Other information:                      
Non-accrual loans(4) $ 45,162     $ 27,181          
Accruing loans − 90 days past due(4)                  
Troubled and restructured non-purchased loans − accruing(4)   1,483       1,251          
                       

 

  (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

  3/31/19     6/30/19     9/30/19     12/31/19     3/31/20     6/30/20     9/30/20     12/31/20  
                                               
  (Dollars in thousands, except per share amounts)  
Earnings Summary:                                                              
Net interest income $ 225,888     $ 224,536     $ 218,780     $ 214,977     $ 209,775     $ 216,593     $ 224,657     $ 237,600  
Federal tax (FTE) adjustment   1,207       1,136       1,038       1,028       1,133       1,753       1,605       1,533  
Net interest income (FTE)   227,095       225,672       219,818       216,005       210,908       218,346       226,262       239,133  
Provision for credit losses   (6,681 )     (6,769 )     (7,854 )     (4,938 )     (117,663 )     (72,026 )     (7,200 )     (6,750 )
Non-interest income   24,072       26,603       26,446       30,406       27,680       21,591       26,676       28,661  
Non-interest expense   (96,678 )     (99,131 )     (100,914 )     (104,406 )     (103,425 )     (100,953 )     (105,641 )     (103,394 )
Pretax income (FTE)   147,808       146,375       137,496       137,067       17,500       66,958       140,097       157,650  
FTE adjustment   (1,207 )     (1,136 )     (1,038 )     (1,028 )     (1,133 )     (1,753 )     (1,605 )     (1,533 )
Provision for income taxes   (35,889 )     (34,726 )     (32,574 )     (35,240 )     (4,509 )     (14,948 )     (29,251 )     (35,607 )
Noncontrolling interest   (6 )     (10 )     7       7       8       9       12       3  
Net income available to common stockholders $ 110,706     $ 110,503     $ 103,891     $ 100,806     $ 11,866     $ 50,266     $ 109,253     $ 120,513  
Earnings per common share – diluted $ 0.86     $ 0.86     $ 0.81     $ 0.78     $ 0.09     $ 0.39     $ 0.84     $ 0.93  
Non-interest Income:                                                              
Service charges on deposit accounts $ 9,722     $ 10,291     $ 10,827     $ 10,933     $ 10,009     $ 8,281     $ 9,427     $ 9,983  
Trust income   1,730       1,839       1,975       2,010       1,939       1,759       1,936       1,909  
BOLI income:                                                              
Increase in cash surrender value   5,162       5,178       5,208       5,167       5,067       5,057       5,081       5,034  
Death benefits               206       2,989       608                    
Loan service, maintenance and other fees   4,874       4,565       4,197       4,282       3,716       3,394       3,351       3,797  
Other income from purchased loans   795       1,455       674       759                          
Gains on sales of other assets   284       402       189       1,358       161       621       891       5,189  
Net gains on investment securities         713                   2,223             2,244        
Other   1,505       2,160       3,170       2,908       3,957       2,479       3,746       2,749  
Total non-interest income $ 24,072     $ 26,603     $ 26,446     $ 30,406     $ 27,680     $ 21,591     $ 26,676     $ 28,661  
Non-interest Expense:                                                              
Salaries and employee benefits $ 44,868     $ 47,558     $ 48,376     $ 52,050     $ 51,473     $ 48,410     $ 53,119     $ 53,832  
Net occupancy and equipment   14,750       14,587       14,825       14,855       15,330       15,756       16,676       15,617  
Other operating expenses   37,060       36,986       37,713       37,501       36,622       36,787       35,846       33,945  
Total non-interest expense $ 96,678     $ 99,131     $ 100,914     $ 104,406     $ 103,425     $ 100,953     $ 105,641     $ 103,394  
Balance Sheet Data:                                                              
Total assets $ 23,005,652     $ 22,960,731     $ 23,402,679     $ 23,555,728     $ 24,565,810     $ 26,380,409     $ 26,888,308     $ 27,162,596  
Non-purchased loans   15,610,681       15,786,809       16,307,621       16,224,539       17,030,378       18,247,431       18,419,958       18,401,495  
Purchased loans   1,864,715       1,698,396       1,427,230       1,307,504       1,197,826       1,063,647       938,485       807,673  
Investment securities – AFS   2,769,602       2,548,489       2,414,722       2,277,389       2,816,556       3,299,944       3,468,243       3,405,351  
Deposits   18,476,868       18,186,215       18,440,078       18,474,259       18,809,190       20,723,598       21,287,405       21,450,356  
Unfunded balance of closed loans   11,544,218       11,167,055       11,429,918       11,325,598       11,334,737       11,411,441       11,604,614       11,847,117  
Common stockholders' equity   3,882,643       3,993,247       4,078,324       4,150,351       4,083,150       4,110,666       4,186,285       4,272,271  
                                                               

Bank OZK
Supplemental Quarterly Financial Data (Continued)
Unaudited

  3/31/19     6/30/19     9/30/19     12/31/19     3/31/20     6/30/20     9/30/20     12/31/20  
                                               
  (Dollars in thousands, except per share amounts)  
Allowance for Credit Losses:                                                              
Balance at beginning of period $ 102,264     $ 105,954     $ 106,642     $ 109,001     $ 108,525     $ 316,409     $ 374,494     $ 377,273  
Adoption of CECL(1) methodology                           94,512                    
Net charge-offs   (2,991 )     (6,081 )     (5,495 )     (5,414 )     (4,291 )     (13,941 )     (4,421 )     (6,718 )
Provision for credit losses   6,681       6,769       7,854       4,938       117,663       72,026       7,200       6,750  
Balance at end of period $ 105,954     $ 106,642     $ 109,001     $ 108,525     $ 316,409     $ 374,494     $ 377,273     $ 377,305  
Allowance for loan losses $ 105,954     $ 106,642     $ 109,001     $ 108,525     $ 238,737     $ 306,196     $ 308,847     $ 295,824  
                                                               
Reserve for losses on unfunded loan commitments                           77,672       68,298       68,426       81,481  
Total allowance for credit losses $ 105,954     $ 106,642     $ 109,001     $ 108,525     $ 316,409     $ 374,494     $ 377,273     $ 377,305  
Selected Ratios:                                                              
Net interest margin – FTE(2)   4.53 %     4.45 %     4.26 %     4.15 %     3.96 %     3.74 %     3.69 %     3.88 %
Efficiency ratio   38.49       39.30       40.98       42.37       43.35       42.07       41.77       38.61  
Net charge-offs to average non-purchased loans(2) (3)   0.05       0.12       0.07       0.10       0.08       0.05       0.09       0.14  
Net charge-offs to average total loans(2)   0.07       0.14       0.12       0.12       0.10       0.29       0.09       0.14  
Nonperforming loans to total loans(4)   0.22       0.15       0.17       0.15       0.16       0.18       0.15       0.25  
Nonperforming assets to total assets(4)   0.21       0.25       0.26       0.18       0.19       0.19       0.17       0.21  
Allowance for loan losses to total loans (5)   0.61       0.61       0.61       0.62       1.31       1.59       1.60       1.54  
Loans past due 30 days or more, including
past due non-accrual loans, to total loans(4)
  0.28       0.13       0.14       0.19       0.18       0.13       0.13       0.16  
                                                               

 

  (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 December 31,     Year Ended December 31,  
  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
$ 1,762,810     $ 428       0.10 %   $ 668,403     $ 2,756       1.64 %   $ 1,535,977     $ 5,665       0.37 %   $ 353,528     $ 6,758       1.91 %
Investment securities:                                                                                              
Taxable   2,036,253       9,066       1.77       1,892,693       11,820       2.48       1,993,667       40,547       2.03       2,099,522       52,812       2.52  
Tax-exempt – FTE   1,485,224       6,034       1.62       457,026       4,207       3.65       1,080,459       24,561       2.27       485,946       18,041       3.71  
Non-purchased loans – FTE   18,378,050       243,330       5.27       16,260,467       241,056       5.88       17,797,684       945,222       5.31       15,861,797       982,430       6.19  
Purchased loans   881,372       16,069       7.25       1,365,846       22,152       6.43       1,069,250       70,812       6.62       1,661,205       106,908       6.44  
Total earning assets – FTE   24,543,709       274,927       4.46       20,644,435       281,991       5.42       23,477,037       1,086,807       4.63       20,461,998       1,166,949       5.70  
Non-interest earning assets   2,258,105                       2,370,753                       2,291,135                       2,297,372                  
Total assets $ 26,801,814                     $ 23,015,188                     $ 25,768,172                     $ 22,759,370                  
LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                              
Interest bearing liabilities:                                                                                              
Deposits:                                                                                              
Savings and interest bearing
transaction
$ 7,669,913     $ 4,483       0.23 %   $ 8,212,286     $ 22,964       1.11 %   $ 7,724,528     $ 37,428       0.48 %   $ 9,039,984     $ 126,685       1.40 %
Time deposits of $100 or more   6,314,394       17,144       1.08       3,914,548       21,281       2.16       5,524,751       83,956       1.52       3,449,197       73,336       2.13  
Other time deposits   3,294,323       8,980       1.08       3,392,019       17,386       2.03       3,511,220       50,429       1.44       2,872,676       58,337       2.03  
Total interest bearing deposits   17,278,630       30,607       0.70       15,518,853       61,631       1.58       16,760,499       171,813       1.03       15,361,857       258,358       1.68  
Repurchase agreements with customers   8,239       6       0.29       11,840       11       0.37       7,825       23       0.29       13,502       50       0.37  
Other borrowings (1)   750,961       1,011       0.54       11,742       34       1.16       721,350       3,179       0.44       94,399       1,531       1.62  
Subordinated notes   223,996       3,207       5.70       223,615       3,216       5.71       223,850       12,758       5.70       223,469       12,757       5.71  
Subordinated debentures (1)   120,400       963       3.18       119,842       1,094       3.62       120,190       4,384       3.65       119,629       5,664       4.73  
Total interest bearing liabilities   18,382,226       35,794       0.77       15,885,892       65,986       1.65       17,833,714       192,157       1.08       15,812,856       278,360       1.76  
Non-interest bearing liabilities:                                                                                              
Non-interest bearing deposits   3,907,955                       2,804,919                       3,521,066                       2,753,634                  
Other non-interest bearing liabilities   289,298                       210,936                       261,169                       217,809                  
Total liabilities   22,579,479                       18,901,747                       21,615,949                       18,784,299                  
Common stockholders’ equity   4,219,249                       4,110,322                       4,149,123                       3,971,952                  
Noncontrolling interest   3,086                       3,119                       3,100                       3,119                  
Total liabilities and stockholders’
equity
$ 26,801,814                     $ 23,015,188                     $ 25,768,172                     $ 22,759,370                  
Net interest income – FTE         $ 239,133                     $ 216,005                     $ 894,650                     $ 888,589          
Net interest margin – FTE                   3.88 %                     4.15 %                     3.81 %                     4.34 %
                                                                                               

 

(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 fourth quarter and $0.68 million for the full year of 2020 compared to $0.04 million for the fourth quarter and $0.90 million for the full year of 2019. In the absence of this interest capitalization, the rates on other borrowings would have been 0.55% for the fourth quarter and 0.53% for the full year of 2020 and 2.64% for the fourth quarter and 2.58% for the full year of 2019. Capitalized interest included in subordinated debentures totaled $0.01 million for the fourth quarter and $0.18 million for the full year of 2020, compared to $0.45 million for the fourth quarter and $0.89 million for the full year of 2019. In the absence of this interest capitalization, the rates on subordinated debentures would have been 3.20% for the fourth quarter and 3.80% for the full year of 2020 and 5.10% for the fourth quarter and 5.48% for the full year 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        
  December 31,     September 30,     Year Ended  
  2020     2019     2020     2020     2019  
                             
  (Dollars in thousands)  
Net income available to common stockholders $ 120,513     $ 100,806     $ 109,253     $ 291,898     $ 425,906  
Average common stockholders’ equity before
noncontrolling interest
$ 4,219,249     $ 4,110,322     $ 4,148,409     $ 4,149,123     $ 3,971,952  
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
  (15,578 )     (25,315 )     (17,461 )     (18,741 )     (29,784 )
Total average intangibles   (676,367 )     (686,104 )     (678,250 )     (679,530 )     (690,573 )
Average tangible common stockholders’ equity $ 3,542,882     $ 3,424,218     $ 3,470,159     $ 3,469,593     $ 3,281,379  
Return on average common stockholders’ equity(1)   11.36 %     9.73 %     10.48 %     7.04 %     10.72 %
Return on average tangible common stockholders'
equity(1)
  13.53 %     11.68 %     12.52 %     8.41 %     12.98 %
                                       

 

  (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

   December 31,     September 30,  
  2020     2019     2020  
                 
  (In thousands, except per share amounts)  
Total common stockholders’ equity before noncontrolling interest $ 4,272,271     $ 4,150,351     $ 4,186,285  
Less intangible assets:                      
Goodwill   (660,789 )     (660,789 )     (660,789 )
Core deposit and other intangible assets, net of accumulated
amortization
  (14,669 )     (23,753 )     (16,462 )
Total intangibles   (675,458 )     (684,542 )     (677,251 )
Total tangible common stockholders' equity $ 3,596,813     $ 3,465,809     $ 3,509,034  
Shares of common stock outstanding   129,350       128,951       129,342  
Book value per common share $ 33.03     $ 32.19     $ 32.37  
Tangible book value per common share $ 27.81     $ 26.88     $ 27.13  
                       

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

   December 31,  
  2020     2019  
           
  (Dollars in thousands)  
Total common stockholders’ equity before noncontrolling interest $ 4,272,271     $ 4,150,351  
Less intangible assets:              
Goodwill   (660,789 )     (660,789 )
Core deposit and other intangible assets, net of accumulated amortization   (14,669 )     (23,753 )
Total intangibles   (675,458 )     (684,542 )
Total tangible common stockholders' equity $ 3,596,813     $ 3,465,809  
Total assets $ 27,162,596     $ 23,555,728  
Less intangible assets:              
Goodwill   (660,789 )     (660,789 )
Core deposit and other intangible assets, net of accumulated amortization   (14,669 )     (23,753 )
Total intangibles   (675,458 )     (684,542 )
Total tangible assets $ 26,487,138     $ 22,871,186  
Ratio of total common stockholders’ equity to total assets   15.73 %     17.62 %
Ratio of total tangible common stockholders’ equity to total
tangible assets
  13.58 %     15.15 %
               

Calculation of Pre-Tax Pre-Provision Net Revenue
Unaudited

  Three Months Ended     Year Ended  
  December 31,     September 30,     December 31,  
  2020     2019     2020     2020     2019  
                             
  (Dollars in thousands)  
Income before taxes $ 156,117     $ 136,039     $ 138,492     $ 376,180     $ 564,337  
Provision for credit losses   6,750       4,938       7,200       203,639       26,241  
Pre-tax pre-provision net revenue $ 162,867     $ 140,977     $ 145,692     $ 579,819     $ 590,578  

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Source: Bank OZK