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Bank OZK Announces Record Fourth Quarter and Full Year 2023 Earnings
来源: Nasdaq GlobeNewswire / 18 1月 2024 15:01:48 America/Chicago
LITTLE ROCK, Ark., Jan. 18, 2024 (GLOBE NEWSWIRE) -- Bank OZK (the “Bank”) (Nasdaq: OZK) today announced that net income available to common stockholders for the fourth quarter of 2023 was a record $171.1 million, a 7.7% increase from $158.8 million for the fourth quarter of 2022. Diluted earnings per common share for the fourth quarter of 2023 were a record $1.50, an 11.9% increase from $1.34 for the fourth quarter of 2022.
For the full year of 2023, net income available to common stockholders was $674.6 million, a 23.2% increase from $547.5 million for the full year of 2022. Diluted earnings per common share for the full year of 2023 were $5.87, a 29.3% increase from $4.54 for the full year of 2022.
Pre-tax pre-provision net revenue (“PPNR”) was $262.6 million for the fourth quarter of 2023, an 8.9% increase from $241.0 million for the fourth quarter of 2022. For the full year of 2023, PPNR was $1.03 billion, a 28.3% increase from $0.81 billion for the full year of 2022. The calculation of PPNR and the reconciliation to generally accepted accounting principles (“GAAP”) are included in the schedules accompanying this release.
The Bank’s annualized returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the fourth quarter of 2023 were 2.04%, 14.58% and 16.99%, respectively, compared to 2.35%, 14.76% and 17.48%, respectively, for the fourth quarter of 2022. The Bank’s returns on average assets, average common stockholders’ equity and average tangible common stockholders’ equity for the full year of 2023 were 2.20%, 14.93% and 17.50%, respectively, compared to 2.08%, 12.66% and 14.97%, respectively, for the full year of 2022. The results for the fourth quarter and full year of 2023 include the impact of a $9.9 million FDIC special assessment recorded during the fourth quarter of 2023. The calculation of the Bank’s returns on average common stockholders’ equity and average tangible common stockholders’ equity and the reconciliations to GAAP are included in the schedules accompanying this release.
George Gleason, Chairman and Chief Executive Officer stated, “We are pleased to have reported record net income and record diluted earnings per share in each quarter of 2023, resulting in net income available to common stockholders for the year of $674.6 million and diluted earnings per common share of $5.87. Our goal for 2024 is to continue to improve our record annual net income and diluted earnings per common share achieved in 2023, and we believe that is a reasonable goal, notwithstanding what appears likely to remain a challenging macroeconomic environment. We feel that we are well positioned for the coming year, and we look forward to capitalizing on new opportunities.”
KEY BALANCE SHEET METRICS
Total loans were $26.46 billion at December 31, 2023, a 27.3% increase from $20.78 billion at December 31, 2022. Deposits were $27.41 billion at December 31, 2023, a 27.5% increase from $21.50 billion at December 31, 2022. Total assets were $34.24 billion at December 31, 2023, a 23.8% increase from $27.66 billion at December 31, 2022.
Common stockholders’ equity was $4.80 billion at December 31, 2023, a 10.3% increase from $4.35 billion at December 31, 2022. Tangible common stockholders’ equity was $4.14 billion at December 31, 2023, a 12.3% increase from $3.69 billion at December 31, 2022. The Bank did not repurchase any shares during the three months ended December 31, 2023. During the full year of 2023, the Bank repurchased 4.3 million shares for $151.5 million, which equates to a weighted average cost of approximately $35.19 per share.
Book value per common share was $42.42 at December 31, 2023, a 14.2% increase from $37.13 at December 31, 2022. Tangible book value per common share was $36.58 at December 31, 2023, a 16.2% increase from $31.47 at December 31, 2022.
The Bank’s ratio of total common stockholders’ equity to total assets was 14.02% at December 31, 2023, compared to 15.73% at December 31, 2022. Its ratio of total tangible common stockholders’ equity to total tangible assets was 12.33% at December 31, 2023, compared to 13.66% at December 31, 2022. The calculations of the Bank’s total common stockholders’ equity, tangible common stockholders’ equity, tangible book value per common share, and ratio of total tangible common stockholders’ equity to total tangible assets and the reconciliations to GAAP are included in the schedules accompanying this release.
ASSET QUALITY
The Bank’s ratio of nonperforming non-purchased loans to total loans (excluding purchased loans) was 0.23% at December 31, 2023, compared to 0.22% as of December 31, 2022. The Bank’s ratio of nonperforming assets to total assets (excluding purchased loans, except for their inclusion in total assets) was 0.36% at December 31, 2023, compared to 0.19% as of December 31, 2022. The Bank's annualized ratio of net charge-offs of total loans to average total loans was 0.06% for the fourth quarter and 0.13% for the twelve months ended December 31, 2023, compared to 0.06% for the fourth quarter and 0.04% for the twelve months ended December 31, 2022.
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 https://ir.ozk.com. This release should be read in conjunction with management’s comments on the fourth quarter and full year 2023 results.
Management will conduct a conference call to take questions at 10:00 a.m. CT (11:00 a.m. ET) on Friday, January 19, 2024. Interested parties may access the conference call live via webcast on the Bank’s investor relations website at https://ir.ozk.com/news/event-calendar, or may participate via telephone by registering using this online form. Upon registration, all telephone participants will receive the dial-in number along with a unique PIN number that can be used to access the call. A replay of the conference call webcast will be archived on the Bank's website for at least 30 days.
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 ir.ozk.com. To receive automated email alerts for these materials please visit https://ir.ozk.com/other/email-alerts 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 common stockholders’ equity, return on average tangible common stockholders’ equity, tangible book value per common share, total common stockholders’ equity, 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.”
FORWARD-LOOKING STATEMENTS
This press 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 in implementing the Bank’s growth, expansion and acquisition strategies, including hiring or retaining qualified personnel, obtaining regulatory or other approvals, delays in acquiring satisfactory sites, obtaining permits and designing, constructing and opening new offices or relocating, selling or closing existing offices; integrating any acquisitions; the availability of and access to capital; possible downgrades in the Bank’s credit ratings or outlook which could increase the costs of or decrease the availability of funding from capital markets; the ability to attract new or retain existing deposits or to retain or grow loans, including growth from unfunded closed loans; the ability to generate future revenue growth or to control future growth in non-interest expense; interest rate fluctuations, including changes in the yield curve between short-term and long-term interest rates or changes in the relative relationships of various interest rate indices; competitive factors and pricing pressures, including their effect on the Bank’s net interest margin or core spread; general economic, unemployment, credit market and real estate market conditions, and the effect of such conditions on the creditworthiness of borrowers, collateral values, the value of investment securities and asset recovery values; conditions within the banking industry, including the effects of recent failures of other financial institutions; recently enacted and potential laws and regulatory requirements or changes to existing laws and regulatory requirements, including changes affecting oversight of the financial services industry, changes intended to manage or mitigate climate and related environmental risks or changes in the interpretation and enforcement of such laws and requirements, and the costs and expenses to comply with new and/or existing legislation and regulatory requirements; uncertainty regarding changes in U.S. government monetary and fiscal policy; the impact of any U.S. federal government shutdown or budgetary crisis; FDIC special assessments or changes to regular assessments; the ability to keep pace with technological changes, including changes regarding artificial intelligence and maintaining cybersecurity; the impact of failure in, or breach of, our operational or security systems or infrastructure, or those of third parties with whom we do business or others, 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, its customers or others; natural disasters; acts of war or terrorism; the potential impact of continuing inflationary pressures; the potential impact of supply chain disruptions; national or international political instability or military conflict, including the conflict in the Middle East and the ongoing war in Ukraine; the competition and costs of recruiting and retaining human talent; impairment of our goodwill; adoption of new accounting standards, or changes in existing standards; and adverse results (including costs, fines, reputational harm and/or other negative effects) from current or future litigation, regulatory examinations or other legal and/or regulatory actions or rulings as well as other factors identified in this communication or as detailed from time to time in our public filings, including those factors described in the disclosures under the headings “Forward-Looking Information” and “Item 1A. Risk Factors” in our most recent Annual Report on Form 10-K for the year ended December 31, 2022 and our 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 described 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. Established in 1903, Bank OZK conducts banking operations in approximately 240 offices in eight states including Arkansas, Georgia, Florida, North Carolina, Texas, New York, California and Mississippi and had $34.24 billion in total assets as of December 31, 2023. For more information, visit www.ozk.com.
Bank OZK
Consolidated Balance Sheets
UnauditedDecember 31, 2023 2022 (Dollars in thousands) ASSETS Cash and cash equivalents $ 2,149,529 $ 1,033,454 Investment securities – available for sale (“AFS”) 3,244,371 3,491,613 Investment securities – trading — 8,817 Federal Home Loan Bank of Dallas (“FHLB”) and other bankers’ bank stocks 50,400 42,406 Non-purchased loans 26,195,030 20,400,154 Purchased loans 264,045 378,637 Allowance for loan losses (339,394 ) (208,858 ) Net Loans 26,119,681 20,569,933 Premises and equipment, net 676,821 678,405 Foreclosed assets 61,720 6,616 Accrued interest receivable 170,110 125,130 Bank owned life insurance (“BOLI”) 808,490 789,805 Goodwill and other intangible assets, net 660,789 663,543 Other, net 295,546 246,846 Total assets $ 34,237,457 $ 27,656,568 LIABILITIES AND STOCKHOLDERS’ EQUITY Deposits: Demand non-interest bearing $ 4,095,874 $ 4,658,451 Savings and interest bearing transaction 9,074,296 9,905,717 Time 14,234,973 6,935,975 Total deposits 27,405,143 21,500,143 Other borrowings 805,318 606,666 Subordinated notes 347,761 346,947 Subordinated debentures 121,652 121,591 Reserve for losses on unfunded loan commitments 161,834 156,419 Accrued interest payable and other liabilities 255,773 233,864 Total liabilities $ 29,097,481 $ 22,965,630 Commitments and contingencies Stockholders’ equity: Preferred Stock: $0.01 par value; 100,000,000 shares authorized;
14,000,000 issued and outstanding at December 31, 2023 and
December 31, 2022338,980 338,980 Common Stock: $0.01 par value; 300,000,000 shares authorized;
113,148,672 and 117,176,928 shares issued and outstanding at
December 31, 2023 and December 31, 2022, respectively1,131 1,172 Additional paid-in capital 1,612,446 1,753,941 Retained earnings 3,283,818 2,773,135 Accumulated other comprehensive loss (97,374 ) (177,649 ) Total stockholders’ equity before noncontrolling interest 5,139,001 4,689,579 Noncontrolling interest 975 1,359 Total stockholders’ equity 5,139,976 4,690,938 Total liabilities and stockholders’ equity $ 34,237,457 $ 27,656,568 Bank OZK
Consolidated Statements of Income
UnauditedThree Months Ended
December 31,Year Ended
December 31,2023 2022 2023 2022 (Dollars in thousands, except per share amounts) Interest income: Non-purchased loans $ 557,844 $ 367,019 $ 1,968,289 $ 1,158,332 Purchased loans 5,412 7,141 23,257 31,441 Investment securities: Taxable 9,667 10,280 39,429 41,526 Tax-exempt 10,670 8,521 38,957 22,653 Deposits with banks 21,901 5,961 58,241 12,116 Total interest income 605,494 398,922 2,128,173 1,266,068 Interest expense: Deposits 218,474 53,230 627,050 94,574 Other borrowings 11,329 8,534 41,669 13,033 Subordinated notes 2,631 2,631 10,439 10,439 Subordinated debentures 2,512 2,039 9,530 5,780 Total interest expense 234,946 66,434 688,688 123,826 Net interest income 370,548 332,488 1,439,485 1,142,242 Provision for credit losses 43,832 32,508 165,470 83,494 Net interest income after provision for credit losses 326,716 299,980 1,274,015 1,058,748 Non-interest income: Service charges on deposit accounts: NSF and overdraft fees 4,700 4,467 18,059 17,724 All other service charges 7,333 7,138 27,995 28,102 Trust income 2,165 1,977 8,524 7,990 BOLI income: Increase in cash surrender value 5,401 4,953 20,696 19,532 Death benefits 2,966 — 2,966 807 Loan service, maintenance and other fees 6,755 3,780 18,920 13,819 Gains on sales of other assets 3,288 510 9,029 11,467 Net gains on investment securities 1,177 1,256 3,243 2,019 Other 3,242 3,463 13,117 13,043 Total non-interest income 37,027 27,544 122,549 114,503 Non-interest expense: Salaries and employee benefits 66,270 59,946 258,846 226,373 Net occupancy and equipment 17,234 17,584 72,591 70,058 Other operating expenses 61,507 41,483 198,124 155,290 Total non-interest expense 145,011 119,013 529,561 451,721 Income before taxes 218,732 208,511 867,003 721,530 Provision for income taxes 43,600 45,686 176,164 157,440 Net income 175,132 162,825 690,839 564,090 Earnings attributable to noncontrolling interest (6 ) 54 (56 ) 51 Preferred stock dividends 4,047 4,047 16,187 16,621 Net income available to common stockholders $ 171,079 $ 158,832 $ 674,596 $ 547,520 Basic earnings per common share $ 1.51 $ 1.35 $ 5.89 $ 4.55 Diluted earnings per common share $ 1.50 $ 1.34 $ 5.87 $ 4.54 Bank OZK
Consolidated Statements of Stockholders’ Equity
UnauditedPreferred Stock Common Stock Additional
Paid-in
CapitalRetained Earnings Accumulated Other Comprehensive (Loss) Income Non-Controlling Interest Total (Dollars in thousands, except per share amounts) Three months ended December 31, 2023: Balances - September 30, 2023 $ 338,980 $ 1,131 $ 1,607,510 $ 3,154,869 $ (198,986 ) $ 1,409 $ 4,904,913 Net income — — — 175,132 — — 175,132 Earnings attributable to noncontrolling interest — — — (6 ) — 6 — Total other comprehensive income — — — — 101,612 — 101,612 Preferred stock dividends, $0.28906 per share — — — (4,047 ) — — (4,047 ) Common stock dividends, $0.37 per share — — — (42,130 ) — — (42,130 ) Return of capital paid to non-controlling interest — — — — — (440 ) (440 ) Issuance of 17,018 shares of common stock pursuant to stock-based compensation plans — — 547 — — — 547 Stock-based compensation expense — — 4,389 — — — 4,389 Forfeitures of 4,578 shares of
unvested restricted common stock— — — — — — — Balances - December 31, 2023 $ 338,980 $ 1,131 $ 1,612,446 $ 3,283,818 $ (97,374 ) $ 975 $ 5,139,976 Year ended December 31, 2023: Balances - December 31, 2022 $ 338,980 $ 1,172 $ 1,753,941 $ 2,773,135 $ (177,649 ) $ 1,359 $ 4,690,938 Net income — — — 690,839 — — 690,839 Earnings attributable to noncontrolling interest — — — (56 ) — 56 — Total other comprehensive income — — — — 80,275 — 80,275 Preferred stock dividends, $1.15624 per share — — — (16,187 ) — — (16,187 ) Common stock dividends, $1.42 per share — — — (163,913 ) — — (163,913 ) Return of capital paid to non-controlling interest (440 ) (440 ) Issuance of 522,651 shares of common stock pursuant to stock-based
compensation plans— 5 1,166 — — — 1,171 Repurchase and cancellation of 4,304,239 shares of common stock under share
repurchase program, including excise taxes— (44 ) (151,421 ) — — — (151,465 ) Repurchase and cancellation of 215,362 shares of common stock withheld for tax pursuant to stock-based compensation
plans— (2 ) (8,672 ) — (8,674 ) Stock-based compensation expense — — 17,432 — — — 17,432 Forfeitures of 31,306 shares of unvested restricted common stock — — — — — — — Balances - December 31, 2023 $ 338,980 $ 1,131 $ 1,612,446 $ 3,283,818 $ (97,374 ) $ 975 $ 5,139,976 Bank OZK
Consolidated Statements of Stockholders’ Equity
UnauditedPreferred Stock Common Stock Additional
Paid-in
CapitalRetained Earnings Accumulated Other Comprehensive (Loss) Income Non-Controlling Interest Total (Dollars in thousands, except per share amounts) Three months ended December 31, 2022: Balances - September 30, 2022 $ 338,980 $ 1,178 $ 1,773,562 $ 2,653,377 $ (227,673 ) $ 3,120 $ 4,542,544 Net income — — — 162,825 — — 162,825 Earnings attributable to noncontrolling interest — — — 54 — (54 ) — Total other comprehensive income — — — — 50,024 — 50,024 Preferred stock dividends, $0.28906 per share — — — (4,047 ) — — (4,047 ) Common stock dividends, $0.33 per share — — — (39,074 ) — — (39,074 ) Return of capital to non-controlling interest — — — — — (1,707 ) (1,707 ) Issuance of 10,496 shares of common stock pursuant to stock-based compensation plans — — 241 — — — 241 Repurchase and cancellation of 574,878 shares of common stock under share repurchase program — (6 ) (23,219 ) — — — (23,225 ) Repurchase and cancellation of 3,890 shares of common stock withheld for tax pursuant to restricted stock vesting — — (174 ) — — — (174 ) Stock-based compensation expense — — 3,531 — — — 3,531 Forfeitures of 16,405 shares of unvested restricted common stock — — — — — — — Balances - December 31, 2022 $ 338,980 $ 1,172 $ 1,753,941 $ 2,773,135 $ (177,649 ) $ 1,359 $ 4,690,938 Year ended December 31, 2022: Balances - December 31, 2021 $ 338,980 $ 1,254 $ 2,093,702 $ 2,378,466 $ 23,841 $ 3,117 $ 4,839,360 Net income — — — 564,090 — — 564,090 Earnings attributable to noncontrolling interest — — — 51 — (51 ) — Total other comprehensive loss — — — — (201,490 ) — (201,490 ) Preferred stock dividends, $1.187 per share — — — (16,621 ) — — (16,621 ) Common stock dividends, $1.26 per share — — — (152,851 ) — — (152,851 ) Return of capital to non-controlling interest — — — — — (1,707 ) (1,707 ) Issuance of 305,839 shares of common stock pursuant to stock-based compensation plans — 3 2,490 — — — 2,493 Repurchase and cancellation of 8,373,398 shares of common stock under share
repurchase program— (83 ) (349,886 ) — — — (349,969 ) Repurchase and cancellation of 116,864 shares of common stock withheld for tax pursuant to stock-based compensation
plans.— (1 ) (5,572 ) — — — (5,573 ) Stock-based compensation expense — — 13,206 — — — 13,206 Forfeitures of 82,397 shares of unvested restricted common stock — (1 ) 1 — — — — Balances - December 31, 2022 $ 338,980 $ 1,172 $ 1,753,941 $ 2,773,135 $ (177,649 ) $ 1,359 $ 4,690,938 Bank OZK
Summary of Non-Interest Expense
UnauditedThree Months Ended
December 31,Year Ended
December 31,2023 2022 2023 2022 (Dollars in thousands) Salaries and employee benefits $ 66,270 $ 59,946 $ 258,846 $ 226,373 Net occupancy and equipment 17,234 17,584 72,591 70,058 Other operating expenses: Deposit insurance and assessments 15,803 2,710 30,351 9,610 Software and data processing 10,577 9,512 39,212 35,373 Professional and outside services 6,233 5,652 21,423 21,581 Advertising and public relations 5,153 2,987 16,150 8,797 Telecommunication services 2,251 2,134 8,865 7,986 Postage and supplies 2,121 1,906 7,981 7,146 ATM expense 1,957 1,834 7,681 6,331 Travel and meals 1,938 1,755 7,582 7,661 Amortization of CRA and tax credit investments 7,618 5,408 27,768 20,293 Other 7,856 7,585 31,111 30,512 Total non-interest expense $ 145,011 $ 119,013 $ 529,561 $ 451,721 Bank OZK
Summary of Total Loans Outstanding
UnauditedDecember 31, 2023 2022 (Dollars in thousands) Real estate: Residential 1-4 family $ 961,338 3.6 % $ 981,567 4.7 % Non-farm/non-residential 5,309,239 20.1 4,665,268 22.5 Construction/land development 11,653,487 44.0 8,215,056 39.5 Agricultural 256,423 1.0 239,689 1.2 Multifamily residential 2,064,106 7.8 1,503,398 7.2 Total real estate 20,244,593 76.5 15,604,978 75.1 Commercial and industrial 1,269,610 4.8 902,321 4.3 Consumer 2,965,042 11.2 2,445,851 11.8 Other 1,979,830 7.5 1,825,641 8.8 Total loans 26,459,075 100.0 % 20,778,791 100.0 % Allowance for loan losses (339,394 ) (208,858 ) Net loans $ 26,119,681 $ 20,569,933 Bank OZK
Allowance for Credit Losses
UnauditedAllowance for Loan Losses Reserve for Losses on Unfunded Loan Commitments Total Allowance for Credit Losses (Dollars in thousands) Three months ended December 31, 2023: Balances – September 30, 2023 $ 303,358 $ 158,128 $ 461,486 Net charge-offs (4,090 ) — (4,090 ) Provision for credit losses 40,126 3,706 43,832 Balances – December 31, 2023 $ 339,394 $ 161,834 $ 501,228 Year ended December 31, 2023: Balances – December 31, 2022 $ 208,858 $ 156,419 $ 365,277 Net charge-offs (29,519 ) — (29,519 ) Provision for credit losses 160,055 5,415 165,470 Balances – December 31, 2023 $ 339,394 $ 161,834 $ 501,228 Three months ended December 31, 2022: Balances – September 30, 2022 $ 200,098 $ 135,537 $ 335,635 Net charge-offs (2,866 ) — (2,866 ) Provision for credit losses 11,626 20,882 32,508 Balances – December 31, 2022 $ 208,858 $ 156,419 $ 365,277 Year ended December 31, 2022: Balances – December 31, 2021 $ 217,380 $ 71,609 $ 288,989 Net charge-offs (7,206 ) — (7,206 ) Provision for credit losses (1,316 ) 84,810 83,494 Balances – December 31, 2022 $ 208,858 $ 156,419 $ 365,277 Bank OZK
Summary of Deposits – By Account Type
UnauditedDecember 31, 2023 2022 (Dollars in thousands) Non-interest bearing $ 4,095,874 14.9 % $ 4,658,451 21.7 % Interest bearing: Transaction (NOW) 4,486,372 16.4 4,097,532 19.1 Savings and money market 4,587,924 16.7 5,808,185 27.0 Time deposits 14,234,973 52.0 6,935,975 32.2 Total deposits $ 27,405,143 100.0 % $ 21,500,143 100.0 % Bank OZK
Summary of Deposits – By Customer Type
UnauditedDecember 31, 2023 2022 (Dollars in thousands) Non-interest bearing $ 4,095,874 14.9 % $ 4,658,451 21.7 % Interest bearing: Consumer and commercial: Consumer – Non-Time 2,792,199 10.2 3,916,078 18.2 Consumer – Time 10,216,217 37.3 4,936,061 23.0 Commercial – Non-Time 2,439,175 8.9 2,741,007 12.7 Commercial – Time 767,566 2.8 516,477 2.4 Public funds 3,725,766 13.6 2,103,392 9.8 Brokered 2,655,317 9.7 2,050,294 9.5 Reciprocal 713,029 2.6 578,383 2.7 Total deposits $ 27,405,143 100.0 % $ 21,500,143 100.0 % Bank OZK
Selected Consolidated Financial Data
UnauditedThree Months Ended
December 31,Year Ended
December 31,2023 2022 %
Change2023 2022 %
Change(Dollars in thousands, except per share amounts) Income statement data: Net interest income $ 370,548 $ 332,488 11.4 % $ 1,439,485 $ 1,142,242 26.0 % Provision for credit losses 43,832 32,508 34.8 165,470 83,494 98.2 Non-interest income 37,027 27,544 34.4 122,549 114,503 7.0 Non-interest expense 145,011 119,013 21.8 529,561 451,721 17.2 Net income 175,132 162,825 7.6 690,839 564,090 22.5 Preferred stock dividends 4,047 4,047 — 16,187 16,621 (2.6 ) Net income available to common stockholders 171,079 158,832 7.7 674,596 547,520 23.2 Pre-tax pre-provision net revenue (1) 262,564 241,019 8.9 1,032,473 805,024 28.3 Common share and per common share data: Diluted earnings per common share $ 1.50 $ 1.34 11.9 % $ 5.87 $ 4.54 29.3 % Basic earnings per common share 1.51 1.35 11.9 5.89 4.55 29.5 Common stock dividends per share 0.37 0.33 12.1 1.42 1.26 12.7 Book value per share 42.42 37.13 14.2 42.42 37.13 14.2 Tangible book value per common share (1) 36.58 31.47 16.2 36.58 31.47 16.2 Weighted-average diluted shares outstanding (thousands) 113,756 118,201 (3.8 ) 114,833 120,700 (4.9 ) End of period shares outstanding (thousands) 113,149 117,177 (3.4 ) 113,149 117,177 (3.4 ) Balance sheet data at period end: Total assets $ 34,237,457 $ 27,656,568 23.8 % $ 34,237,457 $ 27,656,568 23.8 % Total loans 26,459,075 20,778,791 27.3 26,459,075 20,778,791 27.3 Non-purchased loans 26,195,030 20,400,154 28.4 26,195,030 20,400,154 28.4 Purchased loans 264,045 378,637 (30.3 ) 264,045 378,637 (30.3 ) Allowance for loan losses 339,394 208,858 62.5 339,394 208,858 62.5 Foreclosed assets 61,720 6,616 832.9 61,720 6,616 832.9 Investment securities – AFS 3,244,371 3,491,613 (7.1 ) 3,244,371 3,491,613 (7.1 ) Goodwill and other intangible assets, net 660,789 663,543 (0.4 ) 660,789 663,543 (0.4 ) Deposits 27,405,143 21,500,143 27.5 27,405,143 21,500,143 27.5 Other borrowings 805,318 606,666 32.7 805,318 606,666 32.7 Subordinated notes 347,761 346,947 0.2 347,761 346,947 0.2 Subordinated debentures 121,652 121,591 0.1 121,652 121,591 0.1 Unfunded balance of closed loans 20,573,029 21,062,733 (2.3 ) 20,573,029 21,062,733 (2.3 ) Reserve for losses on unfunded loan commitments 161,834 156,419 3.5 161,834 156,419 3.5 Preferred stock 338,980 338,980 — 338,980 338,980 — Total common stockholders’ equity (1) 4,800,021 4,350,599 10.3 4,800,021 4,350,599 10.3 Net unrealized losses on investment securities AFS
included in stockholders' equity(97,374 ) (177,649 ) (97,374 ) (177,649 ) Loan (including purchased loans) to deposit ratio 96.55 % 96.64 % 96.55 % 96.64 % Selected ratios: Return on average assets (2) 2.04 % 2.35 % 2.20 % 2.08 % Return on average common stockholders' equity (1) (2) 14.58 14.76 14.93 12.66 Return on average tangible common stockholders' equity (1) (2) 16.99 17.48 17.50 14.97 Average common equity to total average assets 13.99 15.90 14.74 16.42 Net interest margin – FTE (2) 4.82 5.46 5.16 4.82 Efficiency ratio 35.33 32.84 33.67 35.75 Net charge-offs to average non-purchased loans (2) (3) 0.07 0.09 0.11 0.07 Net charge-offs to average total loans (2) 0.06 0.06 0.13 0.04 Nonperforming loans to total loans (4) 0.23 0.22 0.23 0.22 Nonperforming assets to total assets (4) 0.36 0.19 0.36 0.19 Allowance for loan losses to total loans (5) 1.28 1.01 1.28 1.01 Allowance for credit losses to total loans and unfunded loan commitments 1.07 0.87 1.07 0.87 Other information: Non-accrual loans (4) $ 60,982 $ 43,411 $ 60,982 $ 43,411 Accruing loans - 90 days past due (4) — — — — (1) Calculations of pre-tax pre-provision net revenue, total common stockholders’ equity, tangible book value per common share and returns on average common stockholders’ equity and 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
Selected Consolidated Financial Data (continued)
UnauditedThree Months Ended December 31, 2023 September 30, 2023 %
Change(Dollars in thousands, except per share amounts) Income statement data: Net interest income $ 370,548 $ 367,261 0.9 % Provision for credit losses 43,832 44,036 (0.5 ) Non-interest income 37,027 25,727 43.9 Non-interest expense 145,011 128,978 12.4 Net income 175,132 173,830 0.7 Preferred stock dividends 4,047 4,047 — Net income available to common stockholders 171,079 169,746 0.8 Pre-tax pre-provision net revenue (1) 262,564 264,010 (0.5 ) Common share and per common share data: Diluted earnings per common share $ 1.50 $ 1.49 0.7 % Basic earnings per common share 1.51 1.50 0.7 Common stock dividends per share 0.37 0.36 2.8 Book value per share 42.42 40.35 5.1 Tangible book value per common share (1) 36.58 34.50 6.0 Weighted-average diluted shares outstanding (thousands) 113,756 113,770 — End of period shares outstanding (thousands) 113,149 113,136 — Balance sheet data at period end: Total assets $ 34,237,457 $ 32,767,328 4.5 % Total loans 26,459,075 25,331,740 4.5 Non-purchased loans 26,195,030 25,051,214 4.6 Purchased loans 264,045 280,526 (5.9 ) Allowance for loan losses 339,394 303,358 11.9 Foreclosed assets 61,720 68,738 (10.2 ) Investment securities – AFS 3,244,371 3,153,817 2.9 Goodwill and other intangible assets, net 660,789 660,789 — Deposits 27,405,143 25,552,856 7.2 Other borrowings 805,318 1,430,192 (43.7 ) Subordinated notes 347,761 347,556 0.1 Subordinated debentures 121,652 121,652 — Unfunded balance of closed loans 20,573,029 20,625,371 (0.3 ) Reserve for losses on unfunded loan commitments 161,834 158,128 2.3 Preferred stock 338,980 338,980 — Total common stockholders’ equity (1) 4,800,021 4,564,524 5.2 Net unrealized losses on investment securities AFS
included in stockholders' equity(97,374 ) (198,986 ) Loan (including purchased loans) to deposit ratio 96.55 % 99.13 % Selected ratios: Return on average assets (2) 2.04 % 2.13 % Return on average common stockholders' equity (1) (2) 14.58 14.81 Return on average tangible common stockholders' equity (1) (2) 16.99 17.33 Average common equity to total average assets 13.99 14.38 Net interest margin – FTE (2) 4.82 5.05 Efficiency ratio 35.33 32.60 Net charge-offs to average non-purchased loans (2) (3) 0.07 0.17 Net charge-offs to average total loans (2) 0.06 0.15 Nonperforming loans to total loans (4) 0.23 0.25 Nonperforming assets to total assets (4) 0.36 0.40 Allowance for loan losses to total loans (5) 1.28 1.20 Allowance for credit losses to total loans and unfunded loan commitments 1.07 1.00 Other information: Non-accrual loans (4) $ 60,982 $ 62,648 Accruing loans - 90 days past due (4) — — (1) Calculations of pre-tax pre-provision net revenue, total common stockholders’ equity, tangible book value per common share and returns on average common stockholders’ equity and 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
Unaudited12/31/23 9/30/23 6/30/23 3/31/23 12/31/22 (Dollars in thousands) Earnings summary: Net interest income $ 370,548 $ 367,261 $ 356,824 $ 344,852 $ 332,488 Federal tax (FTE) adjustment 2,925 2,632 2,602 2,603 2,383 Net interest income (FTE) 373,473 369,893 359,426 347,455 334,871 Provision for credit losses (43,832 ) (44,036 ) (41,774 ) (35,829 ) (32,508 ) Non-interest income 37,027 25,727 31,987 27,809 27,544 Non-interest expense (145,011 ) (128,978 ) (129,355 ) (126,217 ) (119,013 ) Pre-tax income (FTE) 221,657 222,606 220,284 213,218 210,894 FTE adjustment (2,925 ) (2,632 ) (2,602 ) (2,603 ) (2,383 ) Provision for income taxes (43,600 ) (46,144 ) (45,717 ) (40,703 ) (45,686 ) Noncontrolling interest (6 ) (37 ) (1 ) (12 ) 54 Preferred stock dividend (4,047 ) (4,047 ) (4,047 ) (4,047 ) (4,047 ) Net income available to common stockholders $ 171,079 $ 169,746 $ 167,917 $ 165,853 $ 158,832 Earnings per common share – diluted $ 1.50 $ 1.49 $ 1.47 $ 1.41 $ 1.34 Pre-tax pre-provision net revenue (1) $ 262,564 $ 264,010 $ 259,456 $ 246,444 $ 241,019 Selected balance sheet data at period end: Total assets $ 34,237,457 $ 32,767,328 $ 30,761,870 $ 28,971,170 $ 27,656,568 Non-purchased loans 26,195,030 25,051,214 23,291,785 21,700,941 20,400,154 Purchased loans 264,045 280,526 315,661 361,065 378,637 Investment securities – AFS 3,244,371 3,153,817 3,262,366 3,422,031 3,491,613 Deposits 27,405,143 25,552,856 23,983,397 22,282,983 21,500,143 Unfunded balance of closed loans 20,573,029 20,625,371 21,119,761 20,965,040 21,062,733 Allowance for credit losses: Balance at beginning of period $ 461,486 $ 426,820 $ 393,767 $ 365,277 $ 335,635 Net charge-offs (4,090 ) (9,370 ) (8,721 ) (7,339 ) (2,866 ) Provision for credit losses 43,832 44,036 41,774 35,829 32,508 Balance at end of period $ 501,228 $ 461,486 $ 426,820 $ 393,767 $ 365,277 Allowance for loan losses $ 339,394 $ 303,358 $ 263,188 $ 222,025 $ 208,858 Reserve for losses on unfunded loan commitments 161,834 158,128 163,632 171,742 156,419 Total allowance for credit losses $ 501,228 $ 461,486 $ 426,820 $ 393,767 $ 365,277 Selected ratios: Net interest margin – FTE (2) 4.82 % 5.05 % 5.32 % 5.54 % 5.46 % Efficiency ratio 35.33 32.60 33.05 33.63 32.84 Net charge-offs to average non-purchased loans (2) (3) 0.07 0.17 0.03 0.15 0.09 Net charge-offs to average total loans (2) 0.06 0.15 0.15 0.14 0.06 Nonperforming loans to total loans (4) 0.23 0.25 0.15 0.15 0.22 Nonperforming assets to total assets (4) 0.36 0.40 0.32 0.34 0.19 Allowance for loan losses to total loans (5) 1.28 1.20 1.11 1.01 1.01 Allowance for credit losses to total loans
and unfunded loan commitments1.07 1.00 0.95 0.92 0.87 Loans past due 30 days or more, including past due
non-accrual loans, to total loans (4)0.20 0.21 0.14 0.15 0.13 (1) Calculations of pre-tax pre-provision net revenue and the reconciliation 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
Average Consolidated Balance Sheets and Net Interest Analysis – FTE
UnauditedThree Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 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 Interest earning assets: Interest earning deposits and federal funds sold $ 1,637,395 $ 21,902 5.31 % $ 692,066 $ 5,961 3.42 % $ 1,164,595 $ 58,241 5.00 % $ 940,116 $ 12,116 1.29 % Investment securities: Taxable 2,143,606 9,667 1.79 2,566,011 10,280 1.59 2,299,254 39,429 1.71 2,950,929 41,526 1.41 Tax-exempt – FTE 1,097,750 13,506 4.88 974,070 10,786 4.39 1,049,642 49,313 4.70 774,038 28,675 3.70 Non-purchased loans – FTE 25,590,389 557,932 8.65 19,728,477 367,136 7.38 23,258,595 1,968,696 8.46 18,744,652 1,159,161 6.18 Purchased loans 271,222 5,412 7.92 391,801 7,141 7.23 321,570 23,257 7.23 445,955 31,441 7.05 Total earning assets – FTE 30,740,362 608,419 7.85 24,352,425 401,304 6.54 28,093,656 2,138,936 7.61 23,855,690 1,272,919 5.34 Non-interest earning assets 2,538,592 2,508,505 2,550,276 2,472,672 Total assets $ 33,278,954 $ 26,860,930 $ 30,643,932 $ 26,328,362 LIABILITIES AND STOCKHOLDERS’ EQUITY Interest bearing liabilities: Deposits: Savings and interest bearing transaction $ 9,004,724 $ 64,165 2.83 % $ 9,519,104 $ 26,543 1.11 % $ 9,152,060 $ 211,498 2.31 % $ 9,588,372 $ 48,344 0.50 % Time deposits 13,280,889 154,309 4.61 6,321,731 26,687 1.67 10,543,800 415,552 3.94 5,680,395 46,229 0.81 Total interest bearing deposits 22,285,613 218,474 3.89 15,840,835 53,230 1.33 19,695,860 627,050 3.18 15,268,767 94,573 0.62 Other borrowings 863,828 11,329 5.20 753,605 8,533 4.49 803,797 41,669 5.18 673,932 13,034 1.93 Subordinated notes 347,661 2,631 3.00 346,847 2,631 3.01 347,356 10,439 3.01 346,538 10,439 3.01 Subordinated debentures 121,652 2,512 8.19 121,523 2,039 6.66 121,648 9,530 7.83 121,310 5,780 4.76 Total interest bearing liabilities 23,618,754 234,946 3.95 17,062,810 66,433 1.54 20,968,661 688,688 3.28 16,410,547 123,826 0.75 Non-interest bearing liabilities: Non-interest bearing deposits 4,150,323 4,751,644 4,315,200 4,873,842 Other non-interest bearing liabilities 513,326 435,108 502,732 378,471 Total liabilities 28,282,403 22,249,562 25,786,593 21,662,860 Total stockholders’ equity before noncontrolling interest 4,995,217 4,608,570 4,855,976 4,662,467 Noncontrolling interest 1,334 2,798 1,363 3,035 Total liabilities and stockholders’ equity $ 33,278,954 $ 26,860,930 $ 30,643,932 $ 26,328,362 Net interest income – FTE $ 373,473 $ 334,871 $ 1,450,248 $ 1,149,093 Net interest margin – FTE 4.82 % 5.46 % 5.16 % 4.82 % Core spread (1) 4.76 % 6.05 % 5.28 % 5.56 % (1) Core spread is the difference between the yield on the Bank’s non-purchased loans-FTE and the rate on its interest bearing deposits.
Bank OZK
Reconciliation of Non-GAAP Financial Measures
Calculation of Average Common Stockholders’ Equity,
Average Tangible Common Stockholders’ Equity
and the Annualized Returns on Average Common Stockholders’ Equity and
Average Tangible Common Stockholders’ Equity
UnauditedThree Months Ended December 31, September 30, Year Ended December 31, 2023 2022 2023 2023 2022 (Dollars in thousands) Net income available to common stockholders $ 171,079 $ 158,832 $ 169,746 $ 674,596 $ 547,520 Average stockholders’ equity before noncontrolling interest $ 4,995,217 $ 4,608,570 $ 4,885,620 $ 4,855,976 $ 4,662,467 Less average preferred stock (338,980 ) (338,980 ) (338,980 ) (338,980 ) (338,980 ) Total average common stockholders’ equity 4,656,237 4,269,590 4,546,640 4,516,996 4,323,487 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 — (3,421 ) — (821 ) (5,443 ) Total average intangibles (660,789 ) (664,210 ) (660,789 ) (661,610 ) (666,232 ) Average tangible common stockholders’ equity $ 3,995,448 $ 3,605,380 $ 3,885,851 $ 3,855,386 $ 3,657,255 Return on average common stockholders’ equity(1) 14.58 % 14.76 % 14.81 % 14.93 % 12.66 % Return on average tangible common stockholders’ equity(1) 16.99 % 17.48 % 17.33 % 17.50 % 14.97 % (1) Ratios for interim periods annualized based on actual days.
Calculation of Total Common Stockholders’ Equity,
Total Tangible Common Stockholders’ Equity
and Tangible Book Value per Common Share
UnauditedDecember 31, September 30, 2023 2022 2023 (In thousands, except per share amounts) Total stockholders’ equity before noncontrolling interest $ 5,139,001 $ 4,689,579 $ 4,903,504 Less preferred stock (338,980 ) (338,980 ) (338,980 ) Total common stockholders’ equity $ 4,800,021 $ 4,350,599 $ 4,564,524 Less intangible assets: Goodwill (660,789 ) (660,789 ) (660,789 ) Core deposit and other intangible assets, net of accumulated amortization — (2,754 ) — Total intangibles (660,789 ) (663,543 ) (660,789 ) Total tangible common stockholders’ equity $ 4,139,232 $ 3,687,056 $ 3,903,735 Shares of common stock outstanding 113,149 117,177 113,136 Book value per common share $ 42.42 $ 37.13 $ 40.35 Tangible book value per common share $ 36.58 $ 31.47 $ 34.50 Calculation of Total Common Stockholders’ Equity,
Total Tangible Common Stockholders’ Equity
and the Ratio of Total Tangible Common Stockholders’ Equity
to Total Tangible Assets
UnauditedDecember 31, 2023 2022 (Dollars in thousands) Total stockholders’ equity before noncontrolling interest $ 5,139,001 $ 4,689,579 Less preferred stock (338,980 ) (338,980 ) Total common stockholders’ equity $ 4,800,021 $ 4,350,599 Less intangible assets: Goodwill (660,789 ) (660,789 ) Core deposit and other intangible assets, net of accumulated amortization — (2,754 ) Total intangibles (660,789 ) (663,543 ) Total tangible common stockholders’ equity 4,139,232 3,687,056 Total assets $ 34,237,457 $ 27,656,568 Less intangible assets: Goodwill $ (660,789 ) $ (660,789 ) Core deposit and other intangible assets, net of accumulated amortization — (2,754 ) Total intangibles (660,789 ) (663,543 ) Total tangible assets $ 33,576,668 $ 26,993,025 Ratio of total common stockholders’ equity to total assets 14.02 % 15.73 % Ratio of total tangible common stockholders’ equity to total tangible assets 12.33 % 13.66 % Calculation of Pre-Tax Pre-Provision Net Revenue
UnauditedThree Months Ended Year Ended Dec 31, Sept 30, June 30, March 31, Dec 31, December 31, 2023 2023 2023 2023 2022 2023 2022 (Dollars in thousands) Net income available to common stockholders $ 171,079 $ 169,746 $ 167,917 $ 165,853 $ 158,832 $ 674,596 $ 547,520 Preferred stock dividends 4,047 4,047 4,047 4,047 4,047 16,187 16,621 Earnings attributable to
noncontrolling interest6 37 1 12 (54 ) 56 (51 ) Provision for income taxes 43,600 46,144 45,717 40,703 45,686 176,164 157,440 Provision for credit losses 43,832 44,036 41,774 35,829 32,508 165,470 83,494 Pre-tax pre-provision net revenue $ 262,564 $ 264,010 $ 259,456 $ 246,444 $ 241,019 $ 1,032,473 $ 805,024 Investor Contact: Jay Staley (501) 906-7842 Media Contact: Michelle Rossow (501) 906-3922 
