LITTLE ROCK — Bank of the Ozarks made a profit of $19.1 million in the second quarter, down 62 percent from its earnings in the same period last year, the Little Rock bank said Thursday.
But earnings in the second quarter last year were the highest in the bank’s history — $50.2 million.
The bank acquired three out-of-state banks in the first six months of 2011, all of which had collapsed during the dip in the national economy.
Purchases in April 2011 of two of those banks — The Park Avenue Bank of Valdosta, Ga., and First Choice Community Bank of Dallas, Ga. — added $36.4 million to its quarterly income last year. Bank of the Ozarks hasn’t made any purchases of failed institutions this year.
Bank of the Ozarks earned 55 cents a share in the second quarter, down from $1.46 in the second quarter last year.
Still, the earnings beat the 51 cents a share expected by 14 analysts, on the basis of a survey by Bloomberg News of analysts who cover Bank of the Ozarks.
The bank had assets of $3.8 billion on June 30, down from $4 billion in the second quarter last year.
Bank of the Ozarks shares closed at $30.39 on Thursday, up 42 cents, in trading on the Nasdaq exchange. The bank released its second-quarter earnings after the markets closed Thursday.
George Gleason, the bank’s chairman and chief executive officer, said in a statement Thursday that Bank of the Ozarks’ growth in loans and leases was “robust.”
“Even more importantly, we believe we are well-positioned for future growth and profitability,” Gleason stated.
The bank is doing very well, said Matt Olney, a research analyst at Stephens Inc. in Little Rock. Olney spoke Thursday before Bank of the Ozarks’ earnings were released late in the day.
Stephens expects to seek compensation for investment-banking services from Bank of the Ozarks in the next three months.
“Its profitability is one of the tops of any community bank in the country,” said Olney, who owns no shares in Bank of the Ozarks.
Bank of the Ozarks still has sufficient capital to pursue the purchase of failed banks, he said.
Since 2010, the bank has grown substantially through the acquisition of seven failed banks in Georgia, Florida and South Carolina from the federal government.
But there are few opportunities now to buy failed banks, even though Bank of the Ozarks is still making bids for those banks, Olney said.
The bank has shifted its primary priority for growth to lending instead of buying failed banks, Gleason said in April after first-quarter earnings were announced. Finding quality loans has become a strength of the bank even in a down economy, he said.
One strength of the bank is its real estate lending program in Texas, Gleason said in April. The Texas lenders looked at $8 billion in loan applications last year, did underwriting on about $3 billion of that and closed about $320 million in loans, he said.
“I expect that number will be somewhat higher this year just because we continue to refine and improve our processes,” Gleason said in April.
That allows the bank to screen out all of the loans that don’t meet the bank’s “super high credit standards,” Gleason said.
“We’ve got the best pipeline of loans [in line] for closing that we have ever had in the history of the company,” he said.
Bank of the Ozarks has 115 offices, including 66 in Arkansas, 28 in Georgia, 13 in Texas, four in Florida, two in North Carolina and one each in South Carolina and Alabama.
Business, Pages 25 on 07/13/2012