CONWAY, Ark., July 17, 2014 (GLOBE NEWSWIRE) -- Home BancShares, Inc. (Nasdaq:HOMB), parent company of Centennial Bank, today announced a record quarterly profit of $28.4 million, or $0.43 diluted earnings per share for the second quarter of 2014 compared to $17.7 million or $0.31 diluted earnings per share for the same quarter in 2013. The Company increased its second quarter earnings by $10.8 million or 61.0% for the three months ended June 30, 2014 compared to the same period of the previous year.
Because acquisitions are growth and capital management strategies, earnings excluding amortization of intangibles after-tax are useful in evaluating the Company. Diluted earnings per share excluding intangible amortization for the second quarter of 2014 was $0.44 compared to $0.32 diluted earnings per share excluding intangible amortization for the same period in 2013.
"I am pleased to report the Company has again accomplished another record quarter," said John Allison, Chairman. "During the upcoming quarters, we recognize there is a need for organic loan growth. We are encouraged by the opportunities we have in front of us because we currently have the largest unfunded loan pipeline in our history. For the Florida Traditions acquisition, we plan to achieve the anticipated cost savings as quickly as possible in order to maximize the returns to our shareholders."
Randy Sims, Chief Executive Officer, added, "When compared to the second quarter of 2013, we are delighted to report our diluted earnings per share and net interest margin improved 12 cents and 32 basis points, respectively, during the quarter just ended. For the thirteenth consecutive quarter, excluding merger expenses, we have again reported the most profitable quarter in the Company's history. Additionally, two outstanding metrics were a 41.56% core efficiency ratio and a 1.70% return on average assets for the second quarter of 2014. These improvements and metrics reported by the Company during the second quarter of 2014 are impressive."
Operating Highlights
Each quarter we perform credit impairment tests on the loans acquired in our FDIC loss sharing and non-loss sharing acquisitions. During our second quarter 2014 impairment testing, there were FDIC loss sharing pools evaluated by the Company which were determined to have a material projected credit improvement. As a result of this improvement, the Company will recognize approximately $23.4 million as an adjustment to yield over the weighted average life of the loans ($3.7 million was recognized during the second quarter of 2014). Improvements in credit quality decrease the basis in the related indemnification asset and increase our FDIC true-up liability. This positive event will reduce the indemnification asset by approximately $17.3 million ($3.0 million was recognized for the second quarter of 2014) and increase our FDIC true-up liability by $1.1 million ($42,000 was recognized for the second quarter of 2014). The $17.3 million will be amortized over the weighted average life of the shared-loss agreement. This amortization will be shown as a reduction to FDIC indemnification non-interest income. The $1.1 million will be expensed over the remaining true-up measurement date as other non-interest expense.
Net interest income for the second quarter of 2014 increased 74.0% to $78.0 million from $44.8 million during the second quarter of 2013. For the second quarter of 2014, the effective yield on non-covered loans and covered loans was 6.08% and 19.38%, respectively. Net interest margin, on a fully taxable equivalent basis, was 5.50% for the quarter just ended compared to 5.18% in the second quarter of 2013, an increase of 32 basis points. The pools which have been determined to have material projected credit improvement as a result of the quarterly impairment testing and the acquisition of Liberty have significantly changed the mix and metrics on the net interest margin since December 31, 2012. Although there have been many changes since 2012, the Company continues to remain focused on expanding its net interest margin through opportunities such as improved pricing on interest-bearing deposits.
The Company experienced a $5.4 million increase in the provision for loan losses for non-covered loans during the second quarter of 2014 versus 2013. This expected increase is not an indication of a decline in asset quality, but primarily a reflection of the migration of the Liberty loans from purchased loan accounting treatment to originated loan accounting treatment. Based upon current accounting guidance the allowance for loan losses is not carried over in an acquisition. As a result, virtually none of the Liberty footprint loans had any allocation of the allowance for loan losses at year end. This is the result of all loans acquired on October 24, 2013 from Liberty being recorded at fair value in accordance with the fair value methodology prescribed in ASC Topic 820. However, as the acquired Liberty loans payoff or renew and the Liberty footprint originates new loan production, it is necessary to establish an allowance which represents an amount that, in management's judgment, will be adequate to absorb credit losses.
The Company reported $11.5 million of non-interest income for the second quarter of 2014, compared to $9.8 million for the second quarter of 2013. The most important components of the second quarter non-interest income were $6.2 million from service charges on deposits accounts, $6.0 million from other service charges and fees, $1.8 million from mortgage lending income, $934,000 from insurance commissions, $859,000 from gain on sale of OREO, $793,000 from other income, $445,000 gain on sale of premises and equipment and $323,000 from trust fees offset by the $6.6 million of net amortization on the FDIC indemnification asset.
Non-interest expense for the second quarter of 2014 was $38.6 million compared to $25.9 million for the second quarter of 2013. These increases are primarily associated with the acquisition of Liberty during the fourth quarter of 2013. For the second quarter of 2014, our core efficiency ratio was 41.56% which is improved from the 45.76% reported for second quarter of 2013.
Financial Condition
Total non-covered loans were $4.13 billion at June 30, 2014 compared to $4.19 billion at December 31, 2013. Total covered loans were $263.2 million at June 30, 2014 compared to $282.5 million at December 31, 2013. Total deposits were $5.19 billion at June 30, 2014 compared to $5.39 billion at December 31, 2013. Total assets were $6.67 billion at June 30, 2014 compared to $6.81 billion at December 31, 2013.
Non-performing non-covered loans were $45.0 million as of June 30, 2014, of which $20.7 million were located in Florida. Non-performing non-covered loans as a percent of total non-covered loans were 1.09% as of June 30, 2014 compared to 0.91% as of December 31, 2013. Non-performing non-covered assets were $66.0 million as of June 30, 2014, of which $26.4 million were located in Florida. Non-performing non-covered assets as a percent of total non-covered assets were 1.04% as of June 30, 2014 compared to 1.07% as of December 31, 2013.
The Company's allowance for loan losses for non-covered loans was $48.2 million at June 30, 2014, or 1.17% of total non-covered loans, compared to $39.0 million, or 0.93% of total non-covered loans, at December 31, 2013. As of June 30, 2014 and December 31, 2013, the allowance for loan losses for non-covered loans plus discount for credit losses on non-covered loans acquired to total non-covered loans plus discount for credit losses on non-covered loans acquired was 4.80% and 4.89%, respectively. As of June 30, 2014 and December 31, 2013, the Company's allowance for loan losses for non-covered loans was 107% and 102% of its total non-performing non-covered loans, respectively.
Stockholders' equity was $897.2 million at June 30, 2014 compared to $841.0 million at December 31, 2013, an increase of $56.3 million. Book value per common share was $13.77 at June 30, 2014 compared to $12.92 at December 31, 2013. Tangible book value per common share was $8.83 at June 30, 2014 compared to $7.94 December 31, 2013.
Branches
During the second quarter of 2014, in an effort to achieve efficiencies primarily from the recent acquisitions, the Company closed or merged four Arkansas and two Florida locations. The Company currently has plans for an additional de novo branch location in Naples, Florida, scheduled to open during the third quarter. The Company currently has 83 branches in Arkansas, 50 branches in Florida and 7 branches in Alabama.
Conference Call
Management will conduct a conference call to review this information at 1:00 p.m. CT (2:00 ET) on Thursday, July 17, 2014. Interested parties can listen to this call by calling 1-877-508-9586 and asking for the Home BancShares conference call. A replay of the call will be available by calling 1-877-344-7529, Passcode: 10048164, which will be available until July 25, 2014 at 8:00 a.m. CT (9:00 ET). Internet access to the call will be available live or in recorded version on the Company's website at www.homebancshares.com under "Investor Relations" for 12 months.
General
This release contains forward-looking statements regarding the Company's plans, expectations, goals and outlook for the future. Statements in this press release that are not historical facts should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements of this type speak only as of the date of this news release. By nature, forward-looking statements involve inherent risk and uncertainties. Various factors, including, but not limited to, economic conditions, credit quality, interest rates, loan demand, the ability to successfully integrate new acquisitions and changes in the assumptions used in making the forward-looking statements, could cause actual results to differ materially from those contemplated by the forward-looking statements. Additional information on factors that might affect Home BancShares, Inc.'s financial results is included in its Annual Report on Form 10-K for the year ended December 31, 2013 filed with the Securities and Exchange Commission.
Home BancShares, Inc. is a bank holding company, headquartered in Conway, Arkansas. Our wholly-owned subsidiary, Centennial Bank, provides a broad range of commercial and retail banking plus related financial services to businesses, real estate developers, investors, individuals and municipalities. Centennial Bank has locations in Arkansas, Florida and South Alabama. The Company's common stock is traded through the NASDAQ Global Select Market under the symbol "HOMB."
| Home BancShares, Inc. | |||||
| Consolidated End of Period Balance Sheets | |||||
| (Unaudited) | |||||
| Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | |
| (In thousands) | 2014 | 2014 | 2013 | 2013 | 2013 |
| ASSETS | |||||
| Cash and due from banks | $ 122,167 | $ 124,662 | $ 104,005 | $ 77,261 | $ 75,148 |
| Interest-bearing deposits with other banks | 21,385 | 89,897 | 61,529 | 35,080 | 97,576 |
| Cash and cash equivalents | 143,552 | 214,559 | 165,534 | 112,341 | 172,724 |
| Federal funds sold | 850 | 22,925 | 4,275 | 10,700 | 2,475 |
| Investment securities - available-for-sale | 1,122,803 | 1,175,827 | 1,175,484 | 839,560 | 736,406 |
| Investment securities - held-to-maturity | 205,566 | 132,363 | 114,621 | 9,528 | -- |
| Loans receivable not covered by loss share | 4,133,109 | 4,126,564 | 4,194,437 | 2,378,838 | 2,339,242 |
| Loans receivable covered by FDIC loss share | 263,157 | 270,641 | 282,516 | 308,072 | 329,802 |
| Allowance for loan losses | (51,173) | (48,991) | (43,815) | (38,748) | (41,450) |
| Loans receivable, net | 4,345,093 | 4,348,214 | 4,433,138 | 2,648,162 | 2,627,594 |
| Bank premises and equipment, net | 196,194 | 196,392 | 197,224 | 119,637 | 119,737 |
| Foreclosed assets held for sale not covered by loss share | 20,960 | 23,484 | 29,869 | 14,158 | 15,985 |
| Foreclosed assets held for sale covered by FDIC loss share | 17,196 | 20,201 | 20,999 | 24,320 | 27,073 |
| FDIC indemnification asset | 56,626 | 73,348 | 89,611 | 101,192 | 116,071 |
| Cash value of life insurance | 64,066 | 63,787 | 63,501 | 59,602 | 59,401 |
| Accrued interest receivable | 20,847 | 21,865 | 22,944 | 14,275 | 14,424 |
| Deferred tax asset, net | 73,151 | 82,886 | 89,412 | 46,045 | 46,655 |
| Goodwill | 301,736 | 301,736 | 301,736 | 85,681 | 85,681 |
| Core deposit and other intangibles | 19,984 | 21,131 | 22,298 | 9,655 | 10,457 |
| Other assets | 77,516 | 82,058 | 81,215 | 66,450 | 56,654 |
| Total assets | $ 6,666,140 | $ 6,780,776 | $ 6,811,861 | $ 4,161,306 | $ 4,091,337 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||
| Liabilities | |||||
| Deposits: | |||||
| Demand and non-interest-bearing | $ 1,129,073 | $ 1,057,148 | $ 991,161 | $ 757,328 | $ 733,374 |
| Savings and interest-bearing transaction accounts | 2,756,060 | 2,827,787 | 2,792,423 | 1,683,010 | 1,735,280 |
| Time deposits | 1,306,876 | 1,453,575 | 1,609,462 | 808,480 | 856,581 |
| Total deposits | 5,192,009 | 5,338,510 | 5,393,046 | 3,248,818 | 3,325,235 |
| Federal funds purchased | -- | -- | -- | -- | -- |
| Securities sold under agreements to repurchase | 144,602 | 137,524 | 160,984 | 71,307 | 73,461 |
| FHLB borrowed funds | 349,110 | 354,935 | 350,661 | 270,232 | 130,251 |
| Accrued interest payable and other liabilities | 22,358 | 20,113 | 5,389 | 22,714 | 25,787 |
| Subordinated debentures | 60,826 | 60,826 | 60,826 | 3,093 | 3,093 |
| Total liabilities | 5,768,905 | 5,911,908 | 5,970,906 | 3,616,164 | 3,557,827 |
| Stockholders' equity | |||||
| Common stock | 651 | 651 | 651 | 563 | 562 |
| Capital surplus | 709,516 | 708,868 | 708,058 | 417,627 | 416,795 |
| Retained earnings | 182,382 | 158,838 | 136,386 | 128,316 | 114,172 |
| Accumulated other comprehensive income (loss) | 4,686 | 511 | (4,140) | (1,364) | 1,981 |
| Total stockholders' equity | 897,235 | 868,868 | 840,955 | 545,142 | 533,510 |
| Total liabilities and stockholders' equity | $ 6,666,140 | $ 6,780,776 | $ 6,811,861 | $ 4,161,306 | $ 4,091,337 |
| Home BancShares, Inc. | |||||||
| Consolidated Statements of Income | |||||||
| (Unaudited) | |||||||
| Quarter Ended | Six Months Ended | ||||||
| Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Jun. 30, | Jun. 30, | |
| (In thousands) | 2014 | 2014 | 2013 | 2013 | 2013 | 2014 | 2013 |
| Interest income | |||||||
| Loans | $ 75,404 | $ 75,013 | $ 65,338 | $ 45,003 | $ 44,036 | $ 150,417 | $ 88,195 |
| Investment securities | |||||||
| Taxable | 4,762 | 4,470 | 4,760 | 2,645 | 2,490 | 9,232 | 4,893 |
| Tax-exempt | 2,379 | 2,317 | 1,554 | 1,507 | 1,467 | 4,696 | 2,948 |
| Deposits - other banks | 29 | 24 | 51 | 19 | 86 | 53 | 184 |
| Federal funds sold | 12 | 16 | 14 | 2 | 6 | 28 | 13 |
| Total interest income | 82,586 | 81,840 | 71,717 | 49,176 | 48,085 | 164,426 | 96,233 |
| Interest expense | |||||||
| Interest on deposits | 3,095 | 3,384 | 3,320 | 1,810 | 2,129 | 6,479 | 4,614 |
| Federal funds purchased | -- | -- | 1 | 3 | -- | -- | -- |
| FHLB borrowed funds | 952 | 946 | 915 | 910 | 1,012 | 1,898 | 2,016 |
| Securities sold under agreements to repurchase | 168 | 182 | 171 | 87 | 86 | 350 | 166 |
| Subordinated debentures | 328 | 328 | 255 | 16 | 17 | 656 | 247 |
| Total interest expense | 4,543 | 4,840 | 4,662 | 2,826 | 3,244 | 9,383 | 7,043 |
| Net interest income | 78,043 | 77,000 | 67,055 | 46,350 | 44,841 | 155,043 | 89,190 |
| Provision for loan losses | 6,115 | 6,938 | 4,330 | -- | 850 | 13,053 | 850 |
| Net interest income after provision for loan losses | 71,928 | 70,062 | 62,725 | 46,350 | 43,991 | 141,990 | 88,340 |
| Non-interest income | |||||||
| Service charges on deposit accounts | 6,193 | 5,911 | 6,001 | 4,072 | 4,088 | 12,104 | 7,797 |
| Other service charges and fees | 5,978 | 5,686 | 5,146 | 3,671 | 3,479 | 11,664 | 6,916 |
| Trust fees | 323 | 436 | 284 | 15 | 17 | 759 | 36 |
| Mortgage lending income | 1,801 | 1,513 | 1,470 | 1,527 | 1,619 | 3,314 | 2,991 |
| Insurance commissions | 934 | 1,416 | 778 | 519 | 444 | 2,350 | 1,123 |
| Income from title services | 53 | 50 | 122 | 156 | 136 | 103 | 245 |
| Increase in cash value of life insurance | 281 | 288 | 235 | 203 | 218 | 569 | 398 |
| Dividends from FHLB, FRB, Bankers' bank & other | 501 | 316 | 273 | 179 | 401 | 817 | 576 |
| Gain on sale of SBA loans | -- | -- | -- | 79 | -- | -- | 56 |
| Gain (loss) on sale of premises & equipment, net | 445 | 9 | (315) | 303 | 394 | 454 | 409 |
| Gain (loss) on OREO, net | 859 | 539 | 347 | 777 | 441 | 1,398 | 527 |
| Gain (loss) on securities, net | -- | -- | -- | -- | 111 | -- | 111 |
| FDIC indemnification accretion/(amortization), net | (6,622) | (4,744) | (2,949) | (3,177) | (2,283) | (11,366) | (4,275) |
| Other income | 793 | 761 | 825 | 994 | 740 | 1,554 | 1,920 |
| Total non-interest income | 11,539 | 12,181 | 12,217 | 9,318 | 9,805 | 23,720 | 18,830 |
| Non-interest expense | |||||||
| Salaries and employee benefits | 18,813 | 18,933 | 19,504 | 12,981 | 12,957 | 37,746 | 25,909 |
| Occupancy and equipment | 6,251 | 6,226 | 5,670 | 4,010 | 3,894 | 12,477 | 7,488 |
| Data processing expense | 1,793 | 1,793 | 1,538 | 1,114 | 1,231 | 3,586 | 2,741 |
| Other operating expenses | 11,763 | 12,405 | 28,162 | 8,610 | 7,773 | 24,168 | 15,580 |
| Total non-interest expense | 38,620 | 39,357 | 54,874 | 26,715 | 25,855 | 77,977 | 51,718 |
| Income before income taxes | 44,847 | 42,886 | 20,068 | 28,953 | 27,941 | 87,733 | 55,452 |
| Income tax expense | 16,418 | 15,549 | 7,118 | 10,590 | 10,282 | 31,967 | 20,245 |
| Net income | $ 28,429 | $ 27,337 | $ 12,950 | $ 18,363 | $ 17,659 | $ 55,766 | $ 35,207 |
| Home BancShares, Inc. | |||||||
| Selected Financial Information | |||||||
| (Unaudited) | |||||||
| Quarter Ended | Six Months Ended | ||||||
| Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Jun. 30, | Jun. 30, | |
| (Dollars and shares in thousands, except per share data) | 2014 | 2014 | 2013 | 2013 | 2013 | 2014 | 2013 |
| PER SHARE DATA | |||||||
| Diluted earnings per common share | $ 0.43 | $ 0.42 | $ 0.19 | $ 0.33 | $ 0.31 | $ 0.85 | $ 0.62 |
| Diluted earnings per common share excluding intangible amortization | 0.44 | 0.43 | 0.21 | 0.33 | 0.32 | 0.87 | 0.64 |
| Basic earnings per common share | 0.44 | 0.42 | 0.19 | 0.33 | 0.32 | 0.86 | 0.63 |
| Dividends per share - common | 0.075 | 0.075 | 0.075 | 0.075 | 0.075 | 0.150 | 0.140 |
| Book value per common share | 13.77 | 13.34 | 12.92 | 9.69 | 9.49 | 13.77 | 9.49 |
| Tangible book value per common share | 8.83 | 8.38 | 7.94 | 7.99 | 7.78 | 8.83 | 7.78 |
| STOCK INFORMATION | |||||||
| Average common shares outstanding | 65,140 | 65,123 | 62,865 | 56,256 | 56,234 | 65,131 | 56,228 |
| Average diluted shares outstanding | 65,545 | 65,511 | 63,234 | 56,620 | 56,577 | 65,523 | 56,555 |
| End of period common shares outstanding | 65,142 | 65,135 | 65,082 | 56,278 | 56,243 | 65,142 | 56,243 |
| ANNUALIZED PERFORMANCE METRICS | |||||||
| Return on average assets | 1.70% | 1.64% | 0.83% | 1.80% | 1.71% | 1.67% | 1.70% |
| Return on average assets excluding intangible amortization | 1.83% | 1.77% | 0.91% | 1.89% | 1.80% | 1.80% | 1.79% |
| Return on average assets excluding intangible amortization, provision for loan losses, merger expenses, bargain purchase gain, gain on life insurance proceeds and income taxes (Core ROA) | 3.27% | 3.26% | 2.86% | 3.09% | 2.93% | 3.27% | 2.85% |
| Return on average common equity | 12.96% | 13.00% | 6.68% | 13.63% | 13.27% | 12.98% | 13.47% |
| Return on average tangible common equity excluding intangible amortization | 20.94% | 21.48% | 10.83% | 17.04% | 16.65% | 21.20% | 16.97% |
| Efficiency ratio | 41.09% | 42.07% | 66.73% | 45.67% | 44.98% | 41.58% | 45.50% |
| Core efficiency ratio | 41.56% | 41.39% | 45.22% | 44.76% | 45.76% | 41.48% | 46.07% |
| Net interest margin - FTE | 5.50% | 5.48% | 5.09% | 5.41% | 5.18% | 5.49% | 5.16% |
| Fully taxable equivalent adjustment | $ 1,624 | $ 1,591 | $ 1,133 | $ 1,073 | $ 1,051 | $ 3,215 | $ 2,126 |
| Total revenue | 94,125 | 94,021 | 83,934 | 58,494 | 57,890 | 188,146 | 115,063 |
| EARNINGS EXCLUDING | |||||||
| INTANGIBLE AMORTIZATION | |||||||
| GAAP net income available to common shareholders | $ 28,429 | $ 27,337 | $ 12,950 | $ 18,363 | $ 17,659 | $ 55,766 | $ 35,207 |
| Intangible amortization after-tax | 697 | 709 | 740 | 487 | 488 | 1,406 | 975 |
| Earnings excluding intangible amortization | $ 29,126 | $ 28,046 | $ 13,690 | $ 18,850 | $ 18,147 | $ 57,172 | $ 36,182 |
| GAAP diluted earnings per share | $ 0.43 | $ 0.42 | $ 0.19 | $ 0.33 | $ 0.31 | $ 0.85 | $ 0.62 |
| Intangible amortization after-tax | 0.01 | 0.01 | 0.02 | -- | 0.01 | 0.02 | 0.02 |
| Diluted earnings per share excluding intangible amortization | $ 0.44 | $ 0.43 | $ 0.21 | $ 0.33 | $ 0.32 | $ 0.87 | $ 0.64 |
| OTHER OPERATING EXPENSES | |||||||
| Advertising | $ 581 | $ 522 | $ 653 | $ 363 | $ 120 | $ 1,103 | $ 813 |
| Merger and acquisition expenses | 106 | 849 | 17,315 | 1,034 | 1 | 955 | 29 |
| Amortization of intangibles | 1,147 | 1,167 | 1,218 | 802 | 802 | 2,314 | 1,604 |
| Electronic banking expense | 1,312 | 1,338 | 1,458 | 926 | 960 | 2,650 | 1,823 |
| Directors' fees | 206 | 227 | 179 | 188 | 210 | 433 | 400 |
| Due from bank service charges | 205 | 199 | 179 | 136 | 168 | 404 | 301 |
| FDIC and state assessment | 1,058 | 1,114 | 858 | 684 | 677 | 2,172 | 1,307 |
| Insurance | 582 | 614 | 756 | 572 | 555 | 1,196 | 1,121 |
| Legal and accounting | 419 | 417 | 450 | 227 | 394 | 836 | 716 |
| Other professional fees | 583 | 507 | 561 | 404 | 490 | 1,090 | 963 |
| Operating supplies | 515 | 472 | 455 | 309 | 332 | 987 | 675 |
| Postage | 327 | 352 | 295 | 212 | 231 | 679 | 438 |
| Telephone | 463 | 454 | 375 | 291 | 291 | 917 | 594 |
| Other expense | 4,259 | 4,173 | 3,410 | 2,462 | 2,542 | 8,432 | 4,796 |
| Total other operating expenses | $ 11,763 | $ 12,405 | $ 28,162 | $ 8,610 | $ 7,773 | $ 24,168 | $ 15,580 |
| Home BancShares, Inc. | |||||
| Selected Financial Information | |||||
| (Unaudited) | |||||
| Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | |
| (Dollars in thousands) | 2014 | 2014 | 2013 | 2013 | 2013 |
| BALANCE SHEET RATIOS | |||||
| Total loans to total deposits | 84.67% | 82.37% | 83.01% | 82.70% | 80.27% |
| Common equity to assets | 13.5% | 12.8% | 12.3% | 13.1% | 13.0% |
| Tangible common equity to tangible assets | 9.1% | 8.5% | 8.0% | 11.1% | 10.9% |
| ALLOWANCE FOR LOAN LOSSES | |||||
| Non-Covered | |||||
| Balance, beginning of period | $ 44,024 | $ 39,022 | $ 37,642 | $ 40,498 | $ 42,302 |
| Loans charged off | 2,526 | 2,424 | 2,417 | 5,101 | 3,361 |
| Recoveries of loans previously charged off | 635 | 488 | 358 | 2,245 | 807 |
| Net loans charged off | 1,891 | 1,936 | 2,059 | 2,856 | 2,554 |
| Provision for loan losses | 6,115 | 6,938 | 3,439 | -- | 750 |
| Balance, end of period | $ 48,248 | $ 44,024 | $ 39,022 | $ 37,642 | $ 40,498 |
| Discount for credit losses on non-covered loans acquired | 157,705 | 164,324 | 174,637 | 77,413 | 80,322 |
| Net charge-offs on loans not covered by loss share to average non-covered loans | 0.18% | 0.19% | 0.22% | 0.48% | 0.44% |
| Allowance for loan losses for non-covered loans to total non-covered loans | 1.17% | 1.07% | 0.93% | 1.58% | 1.73% |
| Allowance for loan losses for non-covered loans plus discount for credit losses on non-covered loans acquired to total non-covered loans plus discount for credit losses on non-covered loans acquired | 4.80% | 4.86% | 4.89% | 4.68% | 4.99% |
| Covered | |||||
| Balance, beginning of period | $ 4,967 | $ 4,793 | $ 1,106 | $ 952 | $ 3,633 |
| Loans charged off | 1,051 | -- | 287 | -- | 3,187 |
| Recoveries of loans previously charged off | 128 | 174 | 29 | 154 | 6 |
| Net loans charged off/(recovered) | 923 | (174) | 258 | (154) | 3,181 |
| Provision for loan losses forecasted outside of loss share | 280 | -- | -- | -- | -- |
| Provision for loan losses before benefit attributable to FDIC loss share agreements | (1,399) | -- | 3,945 | -- | 500 |
| Benefit attributable to FDIC loss share agreements | 1,119 | -- | (3,054) | -- | (400) |
| Net provision for loan losses | -- | -- | 891 | -- | 100 |
| Increase (decrease) in FDIC indemnification asset | (1,119) | -- | 3,054 | -- | 400 |
| Balance, end of period | $ 2,925 | $ 4,967 | $ 4,793 | $ 1,106 | $ 952 |
| Total allowance for loan losses | $ 51,173 | $ 48,991 | $ 43,815 | $ 38,748 | $ 41,450 |
| NON-PERFORMING ASSETS | |||||
| NOT COVERED BY LOSS SHARE | |||||
| Non-performing non-covered loans | |||||
| Non-accrual non-covered loans | $ 21,900 | $ 20,697 | $ 15,133 | $ 17,187 | $ 17,798 |
| Non-covered loans past due 90 days or more | 23,081 | 21,981 | 23,141 | 11,248 | 11,514 |
| Total non-performing non-covered loans | 44,981 | 42,678 | 38,274 | 28,435 | 29,312 |
| Other non-performing non-covered assets | |||||
| Non-covered foreclosed assets held for sale, net | 20,960 | 23,484 | 29,869 | 14,158 | 15,985 |
| Other non-performing non-covered assets | 10 | 47 | 281 | 185 | 172 |
| Total other non-performing non-covered assets | 20,970 | 23,531 | 30,150 | 14,343 | 16,157 |
| Total non-performing non-covered assets | $ 65,951 | $ 66,209 | $ 68,424 | $ 42,778 | $ 45,469 |
| Allowance for loan losses for non-covered loans to non-performing non-covered loans | 107.26% | 103.15% | 101.95% | 132.38% | 138.16% |
| Non-performing non-covered loans to total non-covered loans | 1.09% | 1.03% | 0.91% | 1.20% | 1.25% |
| Non-performing non-covered assets to total non-covered assets | 1.04% | 1.03% | 1.07% | 1.15% | 1.26% |
| Home BancShares, Inc. | |||||
| Loan Information | |||||
| (Unaudited) | |||||
| Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | |
| (Dollars in thousands) | 2014 | 2014 | 2013 | 2013 | 2013 |
| LOANS NOT COVERED BY LOSS SHARE | |||||
| Real estate | |||||
| Commercial real estate loans | |||||
| Non-farm/non-residential | $ 1,733,029 | $ 1,722,910 | $ 1,739,668 | $ 1,026,937 | $ 1,003,391 |
| Construction/land development | 603,216 | 566,205 | 562,667 | 314,232 | 281,994 |
| Agricultural | 64,409 | 74,775 | 81,618 | 31,906 | 31,119 |
| Residential real estate loans | |||||
| Residential 1-4 family | 887,097 | 890,981 | 913,332 | 529,732 | 528,260 |
| Multifamily residential | 218,615 | 206,348 | 213,232 | 117,639 | 120,899 |
| Total real estate | 3,506,366 | 3,461,219 | 3,510,517 | 2,020,446 | 1,965,663 |
| Consumer | 56,197 | 60,735 | 69,570 | 30,478 | 32,671 |
| Commercial and industrial | 447,459 | 491,525 | 511,421 | 268,900 | 287,351 |
| Agricultural | 56,852 | 44,017 | 37,129 | 30,612 | 26,462 |
| Other | 66,235 | 69,068 | 65,800 | 28,402 | 27,095 |
| Loans receivable not covered by loss share | $ 4,133,109 | $ 4,126,564 | $ 4,194,437 | $ 2,378,838 | $ 2,339,242 |
| LOANS COVERED BY LOSS SHARE | |||||
| Real estate | |||||
| Commercial real estate loans | |||||
| Non-farm/non-residential | $ 107,171 | $ 113,593 | $ 117,164 | $ 134,843 | $ 143,922 |
| Construction/land development | 44,763 | 45,381 | 48,388 | 51,492 | 56,447 |
| Agricultural | 1,145 | 1,184 | 1,232 | 1,253 | 1,784 |
| Residential real estate loans | |||||
| Residential 1-4 family | 91,706 | 92,918 | 98,403 | 102,673 | 107,612 |
| Multifamily residential | 10,002 | 10,043 | 10,378 | 10,525 | 10,644 |
| Total real estate | 254,787 | 263,119 | 275,565 | 300,786 | 320,409 |
| Consumer | 20 | 16 | 20 | 17 | 20 |
| Commercial and industrial | 7,368 | 6,440 | 5,852 | 6,291 | 8,193 |
| Agricultural | -- | -- | -- | -- | -- |
| Other | 982 | 1,066 | 1,079 | 978 | 1,180 |
| Loans receivable covered by loss share | $ 263,157 | $ 270,641 | $ 282,516 | $ 308,072 | $ 329,802 |
| Home BancShares, Inc. | ||||||
| Consolidated Net Interest Margin | ||||||
| (Unaudited) | ||||||
| Three Months Ended | ||||||
| June 30, 2014 | March 31, 2014 | |||||
| Average | Income/ | Yield/ | Average | Income/ | Yield/ | |
| (Dollars in thousands) | Balance | Expense | Rate | Balance | Expense | Rate |
| ASSETS | ||||||
| Earning assets | ||||||
| Interest-bearing balances due from banks | $ 54,726 | $ 29 | 0.21% | $ 63,018 | $ 24 | 0.15% |
| Federal funds sold | 23,349 | 12 | 0.21% | 31,482 | 16 | 0.21% |
| Investment securities - taxable | 1,038,011 | 4,762 | 1.84% | 1,005,313 | 4,470 | 1.80% |
| Investment securities - non-taxable - FTE | 287,679 | 3,889 | 5.42% | 286,328 | 3,789 | 5.37% |
| Loans receivable - FTE | 4,403,767 | 75,518 | 6.88% | 4,427,994 | 75,132 | 6.88% |
| Total interest-earning assets | 5,807,532 | 84,210 | 5.82% | 5,814,135 | 83,431 | 5.82% |
| Non-earning assets | 914,388 | 952,470 | ||||
| Total assets | $ 6,721,920 | $ 6,766,605 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||
| Liabilities | ||||||
| Interest-bearing liabilities | ||||||
| Savings and interest-bearing transaction accounts | $ 2,808,856 | $ 1,227 | 0.18% | $ 2,785,216 | $ 1,279 | 0.19% |
| Time deposits | 1,380,249 | 1,868 | 0.54% | 1,528,079 | 2,105 | 0.56% |
| Total interest-bearing deposits | 4,189,105 | 3,095 | 0.30% | 4,313,295 | 3,384 | 0.32% |
| Federal funds purchased | 110 | -- | 0.00% | 508 | -- | 0.00% |
| Securities sold under agreement to repurchase | 136,444 | 168 | 0.49% | 149,352 | 182 | 0.49% |
| FHLB borrowed funds | 376,326 | 952 | 1.01% | 377,326 | 946 | 1.02% |
| Subordinated debentures | 60,826 | 328 | 2.16% | 60,826 | 328 | 2.19% |
| Total interest-bearing liabilities | 4,762,811 | 4,543 | 0.38% | 4,901,307 | 4,840 | 0.40% |
| Non-interest bearing liabilities | ||||||
| Non-interest bearing deposits | 1,054,233 | 1,003,495 | ||||
| Other liabilities | 24,832 | 8,825 | ||||
| Total liabilities | 5,841,876 | 5,913,627 | ||||
| Shareholders' equity | 880,044 | 852,978 | ||||
| Total liabilities and shareholders' equity | $ 6,721,920 | $ 6,766,605 | ||||
| Net interest spread | 5.44% | 5.42% | ||||
| Net interest income and margin - FTE | $ 79,667 | 5.50% | $ 78,591 | 5.48% | ||
| Home BancShares, Inc. | ||||||
| Consolidated Net Interest Margin | ||||||
| (Unaudited) | ||||||
| Six Months Ended | ||||||
| June 30, 2014 | June 30, 2013 | |||||
| Average | Income/ | Yield/ | Average | Income/ | Yield/ | |
| (Dollars in thousands) | Balance | Expense | Rate | Balance | Expense | Rate |
| ASSETS | ||||||
| Earning assets | ||||||
| Interest-bearing balances due from banks | $ 58,849 | $ 53 | 0.18% | $ 143,153 | $ 184 | 0.26% |
| Federal funds sold | 27,393 | 28 | 0.21% | 12,931 | 13 | 0.20% |
| Investment securities - taxable | 1,021,752 | 9,232 | 1.82% | 567,059 | 4,893 | 1.74% |
| Investment securities - non-taxable - FTE | 287,007 | 7,678 | 5.39% | 168,945 | 4,813 | 5.74% |
| Loans receivable - FTE | 4,415,814 | 150,650 | 6.88% | 2,673,952 | 88,456 | 6.67% |
| Total interest-earning assets | 5,810,815 | 167,641 | 5.82% | 3,566,040 | 98,359 | 5.56% |
| Non-earning assets | 933,324 | 603,930 | ||||
| Total assets | $ 6,744,139 | $ 4,169,970 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||
| Liabilities | ||||||
| Interest-bearing liabilities | ||||||
| Savings and interest-bearing transaction accounts | $ 2,797,102 | $ 2,506 | 0.18% | $ 1,775,486 | $ 1,554 | 0.18% |
| Time deposits | 1,453,755 | 3,973 | 0.55% | 943,561 | 3,060 | 0.65% |
| Total interest-bearing deposits | 4,250,857 | 6,479 | 0.31% | 2,719,047 | 4,614 | 0.34% |
| Federal funds purchased | 308 | -- | 0.00% | -- | -- | 0.00% |
| Securities sold under agreement to repurchase | 142,862 | 350 | 0.49% | 71,140 | 166 | 0.47% |
| FHLB borrowed funds | 376,823 | 1,898 | 1.02% | 130,328 | 2,016 | 3.12% |
| Subordinated debentures | 60,826 | 656 | 2.17% | 15,054 | 247 | 3.31% |
| Total interest-bearing liabilities | 4,831,676 | 9,383 | 0.39% | 2,935,569 | 7,043 | 0.48% |
| Non-interest bearing liabilities | ||||||
| Non-interest bearing deposits | 1,029,004 | 686,636 | ||||
| Other liabilities | 16,873 | 20,757 | ||||
| Total liabilities | 5,877,553 | 3,642,962 | ||||
| Shareholders' equity | 866,586 | 527,008 | ||||
| Total liabilities and shareholders' equity | $ 6,744,139 | $ 4,169,970 | ||||
| Net interest spread | 5.43% | 5.08% | ||||
| Net interest income and margin - FTE | $ 158,258 | 5.49% | $ 91,316 | 5.16% | ||