Bank of the Ozarks, Inc. Announces Second Quarter 2007 Earnings.LITTLE ROCK, Ark. -- Bank of the Ozarks, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : OZRK) today announced that net income for the quarter ended June 30, 2007 was $8,086,000, a 2.0% increase over net income of $7,931,000 for the second quarter of 2006. Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were $0.48 for the second quarter of 2007 compared to $0.47 for the second quarter of 2006, an increase of 2.1%. For the six months ended June 30, 2007, net income totaled $15,607,000, a 4.4% decrease from net income of $16,328,000 for the first six months of 2006. Diluted earnings per share for the first six months of 2007 were $0.93, compared to $0.97 for the first six months of 2006, a decrease of 4.1%. The Company's annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. returns on average assets and average stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. for the second quarter of 2007 were 1.27% and 17.82%, respectively, compared to 1.37% and 21.13% for the second quarter of 2006. Annualized returns on average assets and average stockholders' equity for the six months ended June 30, 2007 were 1.23% and 17.47%, respectively, compared with 1.46% and 21.72% for the six months ended June 30, 2006. Loans and leases were $1.76 billion at June 30, 2007 compared to $1.55 billion at June 30, 2006, an increase of 13.0%. Deposits were $2.16 billion at June 30, 2007 compared to $1.82 billion at June 30, 2006, an increase of 18.5%. Total assets were $2.58 billion at June 30, 2007, a 6.6% increase from $2.42 billion at June 30, 2006. Stockholders' equity increased 19.0% to $178 million at June 30, 2007 compared to $150 million at June 30, 2006. Book value per share increased 18.7% to $10.62 at June 30, 2007 compared to $8.95 at June 30, 2006. Changes in stockholders' equity and book value per share reflect earnings, dividends paid, stock option transactions and changes in unrealized gains Unrealized Gain A profit that results from holding on to an asset rather than cashing it in and using the funds. Notes: Let's say you own a stock that has doubled, but you haven't sold it yet. This is said to be an unrealized gain. and losses on investment securities available for sale. The Company's ratio of common equity to assets was 6.90% as of June 30, 2007 compared to 6.18% as of June 30, 2006, and its ratio of tangible common equity to tangible assets Tangible Asset An asset that has a physical form such as machinery, buildings and land. Notes: This is the opposite of an intangible asset such as a patent or trademark. Whether an asset is tangible or intangible isn't inherently good or bad. was 6.68% as of June 30, 2007 compared to 5.94% as of June 30, 2006. In commenting on these results, George Gleason, Chairman and Chief Executive Officer, stated, "We are pleased to report our second quarter results, which, for the second consecutive quarter, include record net interest income, record income from service charges on deposit accounts and quarter-to-quarter improvement in our net interest margin. We also achieved our best mortgage lending income in seven quarters and our second best quarter of trust income ever. While non-interest expense for the quarter just ended increased compared to the second quarter of 2006, the rate of increase was less than our year-over-year rate of increase of non-interest expense during any of the preceding five quarters. These results reflect good progress in achieving our dual goals of accelerating our rate of revenue growth and decelerating our rate of overhead growth in 2007. Maintaining good asset quality is another of our key goals for 2007, and accordingly we are very pleased to report our favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. second quarter asset quality results." NET INTEREST INCOME Net interest income for the second quarter of 2007 increased 7.3% to a record $19,291,000 compared to $17,985,000 for 2006. Net interest margin, on a fully taxable equivalent ("FTE FTE Full-Time Equivalent FTE Full-Time Employee FTE Full-Time Equivalency FTE Full Time Employment FTE Foundation for Teaching Economics FTE Full Time Enrollment FTE For the Enterprise (SQL) FTE Fund for Theological Education ") basis, was 3.46% in the second quarter of 2007, a decrease of 15 basis points from 3.61% in the second quarter of 2006. Compared to the first quarter of 2007, second quarter 2007 net interest margin (FTE) improved 11 basis points. Net interest income for the six months ended June 30, 2007 increased 6.0% to $37,540,000 compared to $35,423,000 for the six months ended June 30, 2006. The Company's net interest margin (FTE) for the first half of 2007 was 3.41%, a decrease of 31 basis points from 3.72% in the first half of 2006. Mr. Gleason stated, "The relatively flat to slightly inverted yield curve Inverted Yield Curve Usually a chart showing long-term debt instruments that have lower yields than short-term debt instruments. It is sometimes referred to as a negative yield curve. between short-term and long-term interest rates and intense competition continued to provide a challenging interest margin environment during the quarter just ended. Despite these conditions, our growth in loans and leases and the quarter-to-quarter improvement in our net interest margin allowed us to achieve our second consecutive quarter of record net interest income. Our goals for 2007 include improving net interest income each quarter by maintaining, or hopefully improving, our net interest margin and achieving good growth in earning assets Earning Assets Any income-earning asset owned by a company. Notes: These assets are generally interest-bearing accounts, bonds, and securities available for sale. See also: Asset, Asset Valuation, Earnings, Net Interest Margin , primarily loans and leases." NON-INTEREST INCOME Non-interest income for the second quarter of 2007 was $5,623,000 compared to $4,954,000 for the second quarter of 2006, a 13.5% increase. Non-interest income for the six months ended June 30, 2007 was $11,582,000 compared to $11,118,000 for the six months ended June 30, 2006, a 4.2% increase. Service charges on deposit accounts, the Company's largest source of non-interest income, were a record $3,107,000 in the second quarter of 2007, an increase of 20.1% compared to $2,587,000 in the second quarter of 2006. Service charges on deposit accounts increased 21.0% to $5,942,000 for the first half of 2007 compared with $4,909,000 for the first half of 2006. Mortgage lending income increased 4.9% to $817,000 in the second quarter of 2007 compared to $779,000 in the second quarter of 2006. Mortgage lending income was $1,548,000 in the first half of 2007, a 12.0% increase from $1,382,000 in the first half of 2006. Trust income increased 11.1% to $531,000 in the second quarter of 2007 compared to $478,000 in the second quarter of 2006. Trust income was $996,000 in the first half of 2007, a 9.3% increase from $911,000 in the first half of 2006. Sales of investment securities and other assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. resulted in a net loss of $47,000 in the second quarter of 2007 compared to a $38,000 net gain in the second quarter of 2006. Net gains from sales of investment securities and other assets were $325,000 for the first half of 2007 compared to $1,871,000 for the first half of 2006. NON-INTEREST EXPENSE Non-interest expense for the second quarter of 2007 was $11,876,000 compared to $11,017,000 for the second quarter of 2006, an increase of 7.8%, but down slightly from $12,138,000 in the first quarter of 2007. The Company's efficiency ratio for the quarter ended June 30, 2007 was 46.1% compared to 45.8% for the second quarter of 2006. Non-interest expense for the first six months of 2007 was $24,014,000 compared with $22,177,000 for the first six months of 2006, an increase of 8.3%. The Company's efficiency ratio for the first six months of 2007 was 47.3% compared to 45.2% for the first six months of 2006. A number of factors contributed to the Company's growth in non-interest expense in the second quarter of 2007 compared to the second quarter of 2006. These factors include the ongoing costs of facilities and staff added as part of the Company's 2006 branching and corporate growth initiatives, costs from resumption RESUMPTION. To reassume; to promise again; as, the resumption of payment of specie by the banks is general. It also signifies to take things back; as the government has resumed the possession of all the lands which have not been paid for according to the requisitions of the law, and the of FDIC FDIC See: Federal Deposit Insurance Corporation FDIC See Federal Deposit Insurance Corporation (FDIC). deposit insurance assessments and costs of the Company's ongoing growth and expansion efforts. The Company is continuing its growth and de novo [Latin, Anew.] A second time; afresh. A trial or a hearing that is ordered by an appellate court that has reviewed the record of a hearing in a lower court and sent the matter back to the original court for a new trial, as if it had not been previously heard nor decided. branching strategy in 2007, although at a slower pace than in 2006. The Company opened a new banking office in Hot Springs, Arkansas Hot Springs is the tenth most populous city in the state of Arkansas in the United States of America, the county seat of Garland County, Arkansas, and the principal city of the Hot Springs Metropolitan Statistical Area encompassing all of Garland County. during the quarter just ended, and, in the remainder of 2007, it plans to add two new Arkansas banking offices and replace a temporary banking office in Frisco, Texas Frisco is a city in Collin County and Denton County, Texas (USA). It is a northern suburb of Dallas. As of the 2000 census, the city population was 33,714, while according to 2007 estimate, the city's population is approximately 95,000. with a new permanent facility. During the quarter just ended, the Company discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: its plans to establish a new Oklahoma bank subsidiary and closed its Tulsa loan production office. This may delay the Company's plans to expand its North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. loan production office to a full-service banking operation. Opening new offices and replacing existing temporary offices with permanent facilities are subject to availability of suitable sites, designing, constructing, equipping and staffing such offices, obtaining regulatory and other approvals, and many other conditions and contingencies that the Company cannot accurately predict with certainty. ASSET QUALITY, CHARGE-OFFS AND ALLOWANCE Nonperforming loans and leases as a percent of total loans and leases were 0.23% as of June 30, 2007 compared to 0.18% as of June 30, 2006 and 0.25% as of March 31, 2007. Nonperforming assets Nonperforming asset An asset that is not effectively producing income, such as an overdue loan. nonperforming asset An asset that produces no income. as a percent of total assets were 0.26% as of June 30, 2007 compared to 0.13% as of June 30, 2006 and 0.27% as of March 31, 2007. The Company's ratio of loans and leases past due 30 days or more, including past due non-accrual loans and leases, to total loans and leases was 0.53% as of June 30, 2007 compared to 0.45% as of June 30, 2006 and 0.84% as of March 31, 2007. The Company's annualized net charge-off ratio for the second quarter of 2007 was 0.14% compared to 0.09% in the second quarter of 2006 and 0.16% for the first quarter of 2007. The Company's annualized net charge-off ratio was 0.15% for the first six months of 2007 compared to 0.09% for the first six months of 2006 and 0.12% for the full year of 2006. The Company's allowance for loan and lease losses was $18.7 million at June 30, 2007, or 1.07% of total loans and leases, compared to $17.3 million, or 1.12% of total loans and leases, at June 30, 2006. As of June 30, 2007, the Company's allowance for loan and lease losses equaled 466% of its total nonperforming loans and leases. CONFERENCE CALL Management will conduct a conference call to review announcements made in this press release at 10:00 a.m. CDT CDT abbr. Central Daylight Time CDT Central Daylight Time CDT n abbr (US) (= Central Daylight Time) → hora de verano del centro; (BRIT (11:00 a.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT ) on Friday, July 13, 2007. The call will be available live or in recorded version on the Company's website www.bankozarks.com under "Investor Relations Investor relations The process by which the corporation communicates with its investors. " or interested parties calling from locations within the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and Canada may call 1-800-990-4845 up to ten minutes prior to the beginning of the conference and ask for the Bank of the Ozarks conference call. A recorded playback of the entire call will be available on the Company's website or by telephone by calling 1-800-642-1687 in the United States and Canada or 706-645-9291 internationally. The passcode for this telephone playback is 4714174. The telephone playback will be available through July 31, 2007, and the website recording of the call will be available for 12 months. FORWARD LOOKING STATEMENTS This release contains forward looking statements regarding the Company's plans, expectations, goals and outlook for the future, including the Company's goals to accelerate its rate of revenue growth, decelerate de·cel·er·ate v. de·cel·er·at·ed, de·cel·er·at·ing, de·cel·er·ates v.tr. 1. To decrease the velocity of. 2. its rate of overhead growth, and maintain good asset quality, and the Company's goals and expectations for improving net interest income, maintaining or improving net interest margin, growth in earning assets, growth in loans and leases, continuation of its growth and de novo branching strategy, plans to replace a temporary banking office with a new permanent facility and plans to add new banking offices. Actual results may differ materially from those projected in such forward looking statements due to, among other things, continued interest rate changes including changes in the shape of the yield curve, competitive factors, general economic conditions and their effects on the creditworthiness Creditworthiness The condition in which the risk of default on a debt obligation by that entity is deemed low. Creditworthiness Eligibility of an individual or firm to borrow money. of borrowers, collateral values and the value of investment securities, the ability to attract new deposits and loans and leases, delays in identifying and acquiring satisfactory sites and opening new offices, delays in or inability to obtain required regulatory approvals, the ability to generate future revenue growth or to control future growth in non-interest expense, as well as other factors identified in this press release or in Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial under the caption "Forward Looking Information" contained in the Company's 2006 Annual Report to Stockholders and the most recent Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. filed with the Securities and Exchange Commission. GENERAL INFORMATION Bank of the Ozarks, Inc. trades on the NASDAQ Global Select Market under the symbol "OZRK". The Company owns a state-chartered subsidiary bank that conducts banking operations through 63 offices in 34 communities throughout northern, western and central Arkansas, five Texas banking offices, and loan production offices in Little Rock, Arkansas Little Rock, Arkansas required military intervention to desegregate schools (1957–1958). [Am. Hist.: Van Doren, 556–557] See : Bigotry , and Charlotte, North Carolina “Charlotte” redirects here. For other uses, see Charlotte (disambiguation). Charlotte is the largest city in the state of North Carolina and the 20th largest city in the United States. . The Company may be contacted at (501) 978-2265 or P.O. Box 8811, Little Rock, Arkansas 72231-8811. The Company's website is: www.bankozarks.com. [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] |
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