CONWAY, Ark., July 20, 2006 (PRIMEZONE) -- Home BancShares, Inc. (Nasdaq:HOMB) today announced earnings for the quarter ended June 30, 2006. Net income for the quarter was $3,636,000, a 53.3% increase over net income of $2,372,000 for the second quarter of 2005. Diluted earnings per share were $0.25 for the second quarter of 2006 compared to $0.17 for the second quarter of 2005, an increase of 47.1%.
For the six months ended June 30, 2006, net income totaled $7,152,000, a 56.8% increase over net income of $4,561,000 for the first six months of 2005. Diluted earnings per share for the first six months of 2006 were $0.49, compared to $0.33 for the comparable period in 2005, an increase of 48.5%.
Because of acquisitions as both a growth and a capital management strategy, cash earnings (net income excluding amortization of intangibles after-tax) are useful in evaluating the Company. Cash diluted earnings per share were $0.27 for the second quarter of 2006 compared to $0.18 for the second quarter of 2005, an increase of 50.0%. Cash diluted earnings per share for the first six months of 2006 were $0.53, compared to $0.36 for the comparable period in 2005, an increase of 47.2%.
John W. Allison, Chairman and Chief Executive Officer, commented, "We are proud of our ability to produce significant loan growth, earnings enhancements and improvements in asset quality. This organic loan growth combined with de novo branching is helping to provide the foundation for the future of our Company."
Operating Highlights
Net interest income for the second quarter of 2006 increased 37.2% to $15.4 million compared to $11.2 million for the second quarter of 2005. Net interest margin, on a fully taxable equivalent basis, was 3.52% in the quarter just ended compared to 3.35% in the second quarter of 2005, an increase of 17 basis points. The Company's second quarter 2006 net interest margin of 3.52% reflected a decrease of one basis point from the first quarter's 3.53%. While the Company grew both average loans and deposits during the second quarter of 2006, competitive pressures and a slightly inverted yield curve prevented growth in net interest margin on a linked quarter basis.
Net interest income for the six months ended June 30, 2006 increased 42.3% to $30.2 million compared with $21.2 million for the six months ended June 30, 2005. The Company's net interest margin, on a fully taxable equivalent basis, for the first half of 2006 was 3.53%, an increase of 24 basis points from 3.29% in the first half of 2005.
Non-interest income for the second quarter of 2006 was $4.6 million compared with $3.3 million for the second quarter of 2005, a 37.6% increase. Non-interest income for the six months ended June 30, 2006 was $9.0 million compared to $7.2 million for the six months ended June 30, 2005, a 25.8% increase. The increase in non-interest income is the result of the acquisitions completed during 2005 combined with organic growth in fee income.
Non-interest expense for the second quarter of 2006 was $14.1 million compared with $10.4 million for the second quarter of 2005, an increase of 36.3%. Non-interest expense for the first six months of 2006 was $27.8 million compared with $20.0 million for the first six months of 2005, an increase of 38.7%. The increase in non-interest expense is the result of the acquisitions completed during 2005 combined with continued expansion of the Company.
Financial Condition
Total loans were $1.33 billion at June 30, 2006 compared to $1.08 billion at June 30, 2005, an increase of 23.4%. Total deposits were $1.52 billion at June 30, 2006 compared to $1.30 billion at June 30, 2005, an increase of 17.0%. Total assets were $2.04 billion at June 30, 2006, an 18.8% increase from $1.72 billion at June 30, 2005.
Nonperforming loans as a percent of total loans improved to 0.60% as of June 30, 2006 when compared to 0.99% as of June 30, 2005. Nonperforming assets as a percent of total assets were 0.42% as of June 30, 2006 compared to 0.64% as of June 30, 2005.
The Company's allowance for loan losses increased to $25.2 million at June 30, 2006, or 1.90% of total loans, compared to $24.8 million, or 2.31% of total loans, at June 30, 2005. As of June 30, 2006, the Company's allowance for loan losses equaled 319% of its total nonperforming loans compared to 232% as of June 30, 2005.
Stockholders' equity was $210.4 million at June 30, 2006 compared to $160.0 million at June 30, 2005, an increase of 31.5%. Book value per common share with preferred converted to common was $12.52 at June 30, 2006 compared to $11.54 at June 30, 2005, an 8.5% increase. The increases in stockholders' equity and book value per share were primarily the result of the proceeds from the Company's initial public offering, which took place on June 23, 2006, and retained earnings during the prior twelve months.
Branch Expansion
During the first six months of 2006, the Company opened three de novo branch locations plus Arkansas's only mobile branch. These branch locations are located in the Arkansas communities of Searcy and Beebe plus Port Charlotte, Florida. Presently, the Company has four pending Florida de novo branch locations in Key West, Key Largo, Punta Gorda and Marco Island. Three of these four locations are scheduled to open during 2006.
Conference Call
Management will conduct a conference call to review this information at 1:00 p.m. CST (2:00 EST) on Thursday, July 20, 2006. Interested parties can listen to this call by calling 1-877-407-0778 (United States and Canada only) and asking for the Home BancShares conference call. A replay of the call will be available by calling 1-877-660-6853, Account Number: 286, Conference ID: 207190, which will be available until July 27, 2006 at 11:59 p.m. 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 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 Form S-1 filing with the Securities and Exchange Commission.
Home BancShares, Inc. trades on the NASDAQ National Market under the symbol "HOMB". The Company is a financial holding company, headquartered in Conway, Arkansas, with five wholly owned bank subsidiaries that provide a broad range of commercial and retail banking and related financial services to businesses, real estate developers and investors, individuals and municipalities. Three of the bank subsidiaries are located in the central Arkansas market area, a fourth serves Stone County in north central Arkansas, and a fifth serves the Florida Keys and southwestern Florida.
Home BancShares, Inc. Consolidated End of Period Balance Sheets (Unaudited) Jun. 30, Mar. 31, Dec. 31, (In thousands) 2006 2006 2005 ------------------------------- ---------- ---------- ---------- ASSETS ------ Cash and due from banks $ 50,516 $ 42,700 $ 39,248 Interest-bearing deposits with other banks 1,406 5,323 5,431 ---------- ---------- ---------- Cash and cash equivalents 51,922 48,023 44,679 Federal funds sold 11,102 19,558 7,055 Investment securities - available for sale 515,063 525,257 530,302 Loans receivable 1,328,351 1,246,146 1,204,589 Allowance for loan losses (25,245) (24,435) (24,175) ---------- ---------- ---------- Loans receivable, net 1,303,106 1,221,711 1,180,414 Bank premises and equipment, net 52,556 52,376 51,762 Foreclosed assets held for sale 611 663 758 Cash value of life insurance 6,954 6,900 6,850 Investments in unconsolidated affiliates 12,634 12,689 9,813 Accrued interest receivable 12,587 11,540 11,158 Deferred tax asset, net 11,903 9,433 8,821 Goodwill 37,527 37,527 37,527 Core deposit and other intangibles 10,336 10,775 11,200 Other assets 17,186 14,458 11,152 ---------- ---------- ---------- Total assets $2,043,487 $1,970,910 $1,911,491 ========== ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY ----------------------------- Liabilities Deposits: Demand and non-interest- bearing $ 230,818 $ 225,340 $ 209,974 Savings and interest-bearing transaction accounts 531,319 538,860 512,184 Time deposits 757,070 743,243 704,950 ---------- ---------- ---------- Total deposits 1,519,207 1,507,443 1,427,108 Federal funds purchased 10,005 -- 44,495 Securities sold under agreements to repurchase 121,826 98,545 103,718 FHLB and other borrowed funds 126,319 139,305 117,054 Accrued interest payable and other liabilities 11,069 11,846 8,504 Subordinated debentures 44,708 44,731 44,755 ---------- ---------- ---------- Total liabilities 1,833,134 1,801,870 1,745,634 ---------- ---------- ---------- Stockholders' equity Preferred stock A 21 21 21 Preferred stock B 2 2 2 Common stock 146 121 121 Capital surplus 187,847 146,638 146,285 Retained earnings 33,687 30,449 27,331 Accumulated other comprehensive loss (11,350) (8,191) (7,903) Treasury stock -- -- -- ---------- ---------- ---------- Total stockholders' equity 210,353 169,040 165,857 ---------- ---------- ---------- Total liabilities and stockholders' equity $2,043,487 $1,970,910 $1,911,491 ========== ========== ========== Sep. 30, Jun. 30, 2005 2005 ---------- ---------- ASSETS ------ Cash and due from banks $ 48,272 $ 44,928 Interest-bearing deposits with other banks 6,851 4,474 ---------- ---------- Cash and cash equivalents 55,123 49,402 Federal funds sold 16,048 8,338 Investment securities - available for sale 550,470 485,729 Loans receivable 1,185,494 1,076,619 Allowance for loan losses (23,252) (24,827) ---------- ---------- Loans receivable, net 1,162,242 1,051,792 Bank premises and equipment, net 50,180 48,268 Foreclosed assets held for sale 435 308 Cash value of life insurance 6,787 6,726 Investments in unconsolidated affiliates 9,498 9,449 Accrued interest receivable 10,680 7,955 Deferred tax asset, net 6,107 6,424 Goodwill 38,448 24,167 Core deposit and other intangibles 11,693 9,111 Other assets 14,366 12,001 ---------- ---------- Total assets $1,932,077 $1,719,670 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY ---------------------------- Liabilities Deposits: Demand and non-interest-bearing $ 215,761 $ 190,629 Savings and interest-bearing transaction accounts 531,891 484,559 Time deposits 736,764 623,483 ---------- ---------- Total deposits 1,484,416 1,298,671 Federal funds purchased -- 9,940 Securities sold under agreements to repurchase 105,143 80,503 FHLB and other borrowed funds 136,346 121,327 Accrued interest payable and other liabilities 10,295 19,883 Subordinated debentures 29,312 29,335 ---------- ---------- Total liabilities 1,765,512 1,559,659 ---------- ---------- Stockholders' equity Preferred stock A 21 21 Preferred stock B 2 2 Common stock 121 118 Capital surplus 146,368 142,229 Retained earnings 24,110 21,242 Accumulated other comprehensive loss (3,488) (3,032) Treasury stock (569) (569) ---------- ---------- Total stockholders' equity 166,565 160,011 ---------- ---------- Total liabilities and stockholders' equity $1,932,077 $1,719,670 ========== ========== Home BancShares, Inc. Consolidated Statements of Income (Unaudited) Quarter Ended ----------------------------------------------- Jun. 30, Mar. 31, Dec. 31, Sep. 30, Jun. 30, (In thousands) 2006 2006 2005 2005 2005 ------------- ------- ------- ------- ------- ------- Interest income Loans $24,003 $21,842 $20,882 $18,628 $14,149 Investment securities Taxable 4,711 4,725 4,612 4,136 4,114 Tax-exempt 965 967 1,011 681 513 Deposits - other banks 24 41 43 29 21 Federal funds sold 183 159 120 131 27 ------- ------- ------- ------- ------- Total interest income 29,886 27,734 26,668 23,605 18,824 ------- ------- ------- ------- ------- Interest expense Interest on deposits 11,144 9,529 8,871 7,624 5,693 Federal funds purchased 154 304 69 104 104 FHLB and other borrowed funds 1,486 1,476 1,358 1,184 823 Securities sold under agreements to repurchase 994 870 930 717 552 Subordinated debentures 745 749 652 510 456 ------- ------- ------- ------- ------- Total interest expense 14,523 12,928 11,880 10,139 7,628 ------- ------- ------- ------- ------- Net interest income 15,363 14,806 14,788 13,466 11,196 Provision for loan losses 590 484 979 934 863 ------- ------- ------- ------- ------- Net interest income after provision for loan losses 14,773 14,322 13,809 12,532 10,333 ------- ------- ------- ------- ------- Non-interest income Service charges on deposit accounts 2,263 2,052 2,318 2,247 2,062 Other service charges and fees 584 611 544 600 517 Trust fees 169 152 110 109 121 Data processing fees 215 193 205 201 156 Mortgage banking income 439 411 441 549 369 Insurance commissions 205 284 143 148 142 Income from title services 282 237 218 247 214 Increase in cash value of life insurance 55 51 64 62 66 Equity in (loss) income of unconsolidated affiliate (32) (116) (136) 53 (509) Gain on sale of equity investment -- -- -- 465 -- Gain on sale of SBA loans -- 34 -- 83 216 (Loss) gain on sale of securities, net 1 -- -- (386) (110) Other income 418 492 129 118 98 ------- ------- ------- ------- ------- Total non-interest income 4,599 4,401 4,036 4,496 3,342 ------- ------- ------- ------- ------- Non-interest expense Salaries and employee benefits 7,399 7,348 6,328 6,549 5,764 Occupancy and equipment 2,123 2,005 2,095 1,815 1,467 Data processing expense 670 567 569 546 443 Other operating expenses 3,951 3,699 3,747 3,276 2,700 ------- ------- ------- ------- ------- Total non-interest expense 14,143 13,619 12,739 12,186 10,374 ------- ------- ------- ------- ------- Income before taxes 5,229 5,104 5,106 4,842 3,301 Income tax expense 1,593 1,588 1,551 1,512 929 ------- ------- ------- ------- ------- Net income $ 3,636 $ 3,516 $ 3,555 $ 3,330 $ 2,372 ======= ======= ======= ======= ======= Six Months Ended -------------------- Jun. 30, Jun. 30, 2006 2005 -------- -------- Interest income Loans $ 45,845 $ 25,734 Investment securities Taxable 9,436 8,355 Tax-exempt 1,932 1,034 Deposits - other banks 65 29 Federal funds sold 342 33 -------- -------- Total interest income 57,620 35,185 -------- -------- Interest expense Interest on deposits 20,673 10,388 Federal funds purchased 458 226 FHLB and other borrowed funds 2,962 1,504 Securities sold under agreements to repurchase 1,864 1,010 Subordinated debentures 1,494 855 -------- -------- Total interest expense 27,451 13,983 -------- -------- Net interest income 30,169 21,202 Provision for loan losses 1,074 1,914 -------- -------- Net interest income after provision for loan losses 29,095 19,288 -------- -------- Non-interest income Service charges on deposit accounts 4,315 3,754 Other service charges and fees 1,195 955 Trust fees 321 239 Data processing fees 408 262 Mortgage banking income 850 661 Insurance commissions 489 383 Income from title services 519 358 Increase in cash value of life insurance 106 130 Equity in (loss) income of unconsolidated affiliate (148) (509) Gain on sale of equity investment -- -- Gain on sale of SBA loans 34 446 (Loss) gain on sale of securities, net 1 (153) Other income 910 629 -------- -------- Total non-interest income 9,000 7,155 -------- -------- Non-interest expense Salaries and employee benefits 14,747 11,024 Occupancy and equipment 4,128 2,959 Data processing expense 1,237 876 Other operating expenses 7,650 5,151 -------- -------- Total non-interest expense 27,762 20,010 -------- -------- Income before taxes 10,333 6,433 Income tax expense 3,181 1,872 -------- -------- Net income $ 7,152 $ 4,561 ======== ======== Home BancShares, Inc. Selected Financial Information (Unaudited) Quarter Ended (Dollars and shares in ------------------------------------------- thousands, Jun. 30, Mar. 31, Dec. 31, Sep. 30, Jun. 30, except per share data) 2006 2006 2005 2005 2005 ------------------------ ------- ------- ------- ------- ------- PER SHARE DATA -------------- Diluted earnings per share $ 0.25 $ 0.24 $ 0.25 $ 0.24 $ 0.17 Diluted cash earnings per share 0.27 0.26 0.27 0.26 0.18 Basic earnings per share 0.28 0.28 0.28 0.27 0.19 Dividends per share - common 0.02 0.02 0.02 0.02 0.02 Book value per common share 12.49 11.68 11.45 11.55 11.33 Book value per common share with preferred converted to common 12.52 11.83 11.63 11.72 11.54 Tangible book value per common share 9.23 7.70 7.43 7.40 8.50 Tangible book value per common share with preferred converted to common 9.67 8.45 8.21 8.19 9.14 STOCK INFORMATION ----------------- Average common shares outstanding 12,224 12,123 12,098 11,855 11,745 Average diluted shares outstanding 14,530 14,392 14,330 14,093 13,701 End of period common shares outstanding 14,647 12,129 12,114 12,081 11,745 End of period common shares outstanding with preferred converted to common 16,807 14,289 14,260 14,211 13,871 Dividends paid on preferred stock 155 155 153 161 130 ANNUALIZED PERFORMANCE RATIOS ---------------------- Return on average assets 0.73% 0.74% 0.74% 0.74% 0.63% Cash return on average assets 0.81% 0.81% 0.82% 0.81% 0.69% Return on average equity 8.56% 8.51% 8.53% 8.20% 6.24% Cash return on average tangible equity 12.80% 12.86% 13.14% 11.57% 8.33% Efficiency ratio 66.74% 66.68% 63.46% 63.90% 67.29% Net interest margin - FTE 3.52% 3.53% 3.48% 3.38% 3.35% Fully taxable equivalent adjustment 572 583 559 494 394 OTHER OPERATING EXPENSES ------------------------ Advertising $ 612 $ 558 $ 582 $ 490 $ 529 Amortization of intangibles 439 425 438 392 327 ATM expense 160 118 114 104 109 Directors' fees 202 204 182 136 101 Due from bank service charges 84 70 70 68 72 FDIC and state assessment 127 125 146 112 123 Insurance 233 223 132 129 107 Legal and accounting 274 282 177 323 265 Other professional fees 149 134 230 81 117 Operating supplies 253 229 243 189 163 Postage 166 163 173 140 146 Telephone 284 220 216 182 148 Other expense 968 948 1,044 930 493 ------- ------- ------- ------- ------- Total other operating expenses $ 3,951 $ 3,699 $ 3,747 $ 3,276 $ 2,700 ======= ======= ======= ======= ======= Six Months Ended Jun. 30, Jun. 30, 2006 2005 ------- ------- PER SHARE DATA -------------- Diluted earnings per share $ 0.49 $ 0.33 Diluted cash earnings per share 0.53 0.36 Basic earnings per share 0.56 0.37 Dividends per share - common 0.04 0.03 Book value per common share 12.49 11.33 Book value per common share with preferred converted to common 12.52 11.54 Tangible book value per common share 9.23 8.50 Tangible book value per common share with preferred converted to common 9.67 9.14 STOCK INFORMATION ----------------- Average common shares outstanding 12,174 11,745 Average diluted shares outstanding 14,463 13,623 End of period common shares outstanding 14,647 11,745 End of period common shares outstanding with preferred converted to common 16,807 13,871 Dividends paid on preferred stock 310 260 ANNUALIZED PERFORMANCE RATIOS ----------------------------- Return on average assets 0.74% 0.63% Cash return on average assets 0.81% 0.69% Return on average equity 8.53% 6.07% Cash return on average tangible equity 12.83% 8.03% Efficiency ratio 66.70% 66.59% Net interest margin - FTE 3.53% 3.29% Fully taxable equivalent adjustment 1,155 737 OTHER OPERATING EXPENSES ------------------------ Advertising $ 1,170 $ 995 Amortization of intangibles 864 636 ATM expense 278 209 Directors' fees 406 187 Due from bank service charges 154 146 FDIC and state assessment 252 245 Insurance 456 243 Legal and accounting 556 441 Other professional fees 283 223 Operating supplies 482 313 Postage 329 267 Telephone 504 271 Other expense 1,916 975 ------- ------- Total other operating expenses $ 7,650 $ 5,151 ======= ======= Home BancShares, Inc. Selected Financial Information (Unaudited) Jun. 30, Mar. 31, Dec. 31, (Dollars in thousands) 2006 2006 2005 ---------------------- ---------- ---------- ---------- LOAN BALANCES ------------- Real estate Commercial real estate loans Non-farm/non-residential $ 424,645 $ 422,618 $ 411,839 Construction/land development 379,820 331,532 291,515 Agricultural 12,805 13,197 13,112 Residential real estate loans Residential 1-4 family 226,129 220,273 221,831 Multifamily residential 35,017 36,425 34,939 ---------- ---------- ---------- Total real estate 1,078,416 1,024,045 973,236 Consumer 41,920 39,599 39,447 Commercial and industrial 173,715 166,025 175,396 Agricultural 22,665 8,287 8,466 Other 11,635 8,190 8,044 ---------- ---------- ---------- Total loans receivable before allowance for loan losses 1,328,351 1,246,146 1,204,589 Allowance for loan losses 25,245 24,435 24,175 ---------- ---------- ---------- Total loans receivable, net $1,303,106 $1,221,711 $1,180,414 ========== ========== ========== Loans to deposits 87.44% 82.67% 84.41% ALLOWANCE FOR LOAN LOSSES ------------------------- Balance, beginning of period $ 24,435 $ 24,175 $ 23,252 Loans charged off 289 486 504 Recoveries of loans previously charged off 509 262 448 ---------- ---------- ---------- Net (recoveries) loans charged off (220) 224 56 Allowance for loan losses of acquired institutions -- -- -- Provision for loan losses 590 484 979 ---------- ---------- ---------- Balance, end of period $ 25,245 $ 24,435 $ 24,175 ========== ========== ========== Net (recoveries) charge-offs to average loans -0.07% 0.07% 0.02% Allowance for loan losses to total loans 1.90% 1.96% 2.01% NON-PERFORMING ASSETS --------------------- Non-performing loans Non-accrual loans $ 6,697 $ 7,824 $ 7,864 Loans past due 90 days or more 1,208 411 426 ---------- ---------- ---------- Total non-performing loans 7,905 8,235 8,290 ---------- ---------- ---------- Other non-performing assets Foreclosed assets held for sale 611 663 758 Other non-performing assets -- 4 11 ---------- ---------- ---------- Total other non-performing assets 611 667 769 ---------- ---------- ---------- Total non-performing assets $ 8,516 $ 8,902 $ 9,059 ========== ========== ========== Allowance for loan losses to non-performing loans 319.35% 296.72% 291.62% Non-performing loans to total loans 0.60% 0.66% 0.69% Non-performing assets to total assets 0.42% 0.45% 0.47% Sep. 30, Jun. 30, 2005 2005 ---------- ---------- LOAN BALANCES ------------- Real estate Commercial real estate loans Non-farm/non-residential $ 401,292 $ 385,827 Construction/land development 281,942 234,849 Agricultural 14,022 10,572 Residential real estate loans Residential 1-4 family 225,849 205,452 Multifamily residential 27,512 25,661 ---------- ---------- Total real estate 950,617 862,361 Consumer 39,316 34,050 Commercial and industrial 168,672 158,201 Agricultural 19,077 13,572 Other 7,812 8,435 ---------- ---------- Total loans receivable before allowance for loan losses 1,185,494 1,076,619 Allowance for loan losses 23,252 24,827 ---------- ---------- Total loans receivable, net $1,162,242 $1,051,792 ========== ========== Loans to deposits 79.86% 82.90% ALLOWANCE FOR LOAN LOSSES ------------------------- Balance, beginning of period $ 24,827 $ 21,982 Loans charged off 3,324 522 Recoveries of loans previously charged off 155 142 ---------- ---------- Net (recoveries) loans charged off 3,169 380 Allowance for loan losses of acquired institutions 660 2,362 Provision for loan losses 934 863 ---------- ---------- Balance, end of period $ 23,252 $ 24,827 ========== ========== Net (recoveries) charge-offs to average loans 1.12% 0.17% Allowance for loan losses to total loans 1.96% 2.31% NON-PERFORMING ASSETS --------------------- Non-performing loans Non-accrual loans $ 7,664 $ 10,078 Loans past due 90 days or more 169 619 ---------- ---------- Total non-performing loans 7,833 10,697 ---------- ---------- Other non-performing assets Foreclosed assets held for sale 435 308 Other non-performing assets 35 32 ---------- ---------- Total other non-performing assets 470 340 ---------- ---------- Total non-performing assets $ 8,303 $ 11,037 ========== ========== Allowance for loan losses to non- performing loans 296.85% 232.09% Non-performing loans to total loans 0.66% 0.99% Non-performing assets to total assets 0.43% 0.64% Home BancShares, Inc. Consolidated Net Interest Margin (Unaudited) Three Months Ended --------------------------------------------------------- June 30, 2006 March 31, 2006 (Dollars --------------------------- --------------------------- in Average Income/ Yield/ Average Income/ Yield/ thousands) Balance Expense Rate Balance Expense Rate ---------- ---------- ------- ------ --------- ------- ----- ASSETS ------ Earning assets Interest- bearing balances due from banks $ 2,125 $ 24 4.53% $ 3,706 $ 41 4.49% Federal funds sold 14,823 183 4.95% 14,477 159 4.45% Investment securities - taxable 430,923 4,711 4.38% 430,121 4,725 4.46% Investment securities - non-taxable - FTE 91,979 1,496 6.52% 92,627 1,510 6.61% Loans receivable - FTE 1,277,789 24,044 7.55% 1,224,871 21,882 7.25% --------- ------ --------- ------ Total interest- earning assets 1,817,639 30,458 6.72% 1,765,802 28,317 6.50% ------ ------ Non-earning assets 174,109 169,399 --------- --------- Total assets $1,991,748 $1,935,201 ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY ------------- Liabilities Interest- bearing liabilities Interest- bearing transaction and savings deposits $ 535,077 $3,226 2.42% $ 520,287 $2,739 2.14% Time deposits 758,249 7,918 4.19% 715,790 6,790 3.85% --------- ------ ---------- ------ Total interest- bearing deposits 1,293,326 11,144 3.46% 1,236,077 9,529 3.13% Federal funds purchased 11,992 154 5.15% 26,469 304 4.66% Securities sold under agreement to repurchase 105,040 994 3.80% 99,344 870 3.55% FHLB and other borrowed funds 134,088 1,486 4.45% 137,796 1,476 4.34% Subordinated debentures 44,722 745 6.68% 44,746 749 6.79% --------- ------ ---------- ------ Total interest- bearing liabilities 1,589,168 14,523 3.67% 1,544,432 12,928 3.39% ------ ------ Non-interest bearing liabilities Non-interest- bearing deposits 221,723 213,135 Other liabilities 10,443 10,067 ------ ------ Total lia- bilities 1,821,334 1,767,634 Shareholders' equity 170,414 167,567 ------- ------- Total liabilities and share- holders' equity $1,991,748 $1,935,201 ========== ========== Net interest spread 3.05% 3.11% Net interest income and margin - FTE $15,935 3.52% $15,389 3.53% ======= ======= Home BancShares, Inc. Consolidated Net Interest Margin (Unaudited) Six Months Ended --------------------------------------------------------- June 30, 2006 June 30, 2005 (Dollars --------------------------- --------------------------- in Average Income/ Yield/ Average Income/ Yield/ thousands) Balance Expense Rate Balance Expense Rate ---------- ---------- ------- ------ --------- ------- ----- ASSETS ------ Earning assets Interest- bearing balances due from banks $ 2,911 $ 65 4.50% $ 2,644 $ 29 2.21% Federal funds sold 14,651 342 4.71% 2,528 33 2.63% Investment securities - taxable 430,514 9,436 4.42% 444,253 8,355 3.79% Investment securities - non-taxable - FTE 92,303 3,006 6.57% 53,161 1,683 6.38% Loans receivable - FTE 1,251,476 45,926 7.40% 843,967 25,822 6.17% ---------- ------ ---------- ------- Total interest- earning assets 1,791,855 58,775 6.61% 1,346,553 35,922 5.38% ------ ------ Non-earning assets 171,776 120,333 ---------- ---------- Total assets $1,963,631 $1,466,886 ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY ------------- Liabilities Interest- bearing liabilities Interest- bearing transaction and savings deposits $ 527,723 $5,965 2.28% $ 394,020 $2,933 1.50% Time deposits 737,137 14,708 4.02% 551,516 7,455 2.73% --------- ------ ---------- ------ Total interest- bearing deposits 1,264,860 20,673 3.30% 945,536 10,388 2.22% Federal funds purchased 19,191 458 4.81% 16,086 226 2.83% Securities sold under agreement to repurchase 102,208 1,864 3.68% 71,201 1,010 2.86% FHLB and other borrowed funds 135,932 2,962 4.39% 93,628 1,504 3.24% Subordinated debentures 44,734 1,494 6.73% 25,059 855 6.88% --------- ------ ---------- ------ Total interest- bearing liabilities 1,566,925 27,451 3.53% 1,151,510 13,983 2.45% ------ ------ Non-interest bearing liabilities Non-interest- bearing deposits 217,453 152,508 Other liabilities 10,255 11,227 ------ ------ Total lia- bilities 1,794,633 1,315,245 Shareholders' equity 168,998 151,641 ------- ------- Total liabilities and share- holders' equity $1,963,631 $1,466,886 ========== ========== Net interest spread 3.08% 2.93% Net interest income and margin - FTE $31,324 3.53% $21,939 3.29% ======= =======