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Bank of the Ozarks Reports Operating Results (10-K)

March 10, 2011 | About:
10qk

10qk

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Bank of the Ozarks (OZRK) filed Annual Report for the period ended 2010-12-31.

Bank Of The Ozarks has a market cap of $754.6 million; its shares were traded at around $44.25 with a P/E ratio of 16.9 and P/S ratio of 3.5. The dividend yield of Bank Of The Ozarks stocks is 1.6%. Bank Of The Ozarks had an annual average earning growth of 16.1% over the past 10 years. GuruFocus rated Bank Of The Ozarks the business predictability rank of 3.5-star.

Highlight of Business Operations:

Bank of the Ozarks, Inc. (the Company) is an Arkansas business corporation registered under the Bank Holding Company Act of 1956. The Company owns an Arkansas state chartered subsidiary bank, Bank of the Ozarks (the Bank). At December 31, 2010 the Company, through the Bank, conducted banking operations through 90 offices, including 66 offices in Arkansas, seven in Texas, ten in Georgia, three in Florida, two in North Carolina, and one each in South Carolina and Alabama. Subsequent to December 31, 2010, the Company opened its eighth and ninth Texas offices and acquired two additional Georgia offices. The Company also owns Ozark Capital Statutory Trust II, Ozark Capital Statutory Trust III, Ozark Capital Statutory Trust IV and Ozark Capital Statutory Trust V, all 100%-owned finance subsidiary business trusts formed in connection with the issuance of certain subordinated debentures and related trust preferred securities, and, indirectly through the Bank, a subsidiary engaged in the development of real estate. At December 31, 2010 the Company had total assets of $3.27 billion, total loans and leases, including loans covered by Federal Deposit Insurance Corporation (FDIC) loss share agreements, of $2.35 billion, total deposits of $2.54 billion and total common stockholders equity of $320 million. Net interest income for 2010 was $124 million, net income available to common stockholders was $64 million and diluted earnings per common share were $3.75.

Loans comprise the majority of the assets acquired in these acquisitions and all but $8.7 million of consumer loans are subject to loss share agreements with the FDIC whereby the Bank is indemnified against losses on covered loans and covered other real estate owned (covered loans). In conjunction with each of these acquisitions, the Bank entered into loss share agreements with the FDIC such that the Bank and the FDIC will share in the losses on assets covered under the loss share agreements. Pursuant to the terms of the loss share agreements for the Unity acquisition, on losses up to $65.0 million, the FDIC will reimburse the Bank for 80% of losses. On losses exceeding $65.0 million, the FDIC will reimburse the Bank for 95% of losses. Under the terms of the loss share agreements for the Woodlands acquisition, the FDIC will reimburse the Bank for 80% of losses. Pursuant to the terms of the loss share agreements for the Horizon acquisition, the FDIC will

reimburse the Bank on single family residential loans and related foreclosed real estate for (i) 80% of losses up to $11.8 million, (ii) 30% of losses between $11.8 million and $17.9 million and (iii) 80% of losses in excess of $17.9 million. For non-single family residential loans and related foreclosed real estate, the FDIC will reimburse the Bank for (i) 80% of losses up to $32.3 million, (ii) 0% of losses between $32.3 million and $42.8 million and (iii) 80% of losses in excess of $42.8 million. Under the terms of the loss share agreements for the Chestatee and Oglethorpe acquisitions, the FDIC will reimburse the Bank for 80% of losses.

To the extent that actual losses incurred by the Bank are less than (i) $65 million on the Unity assets covered under the loss share agreements, (ii) $107 million on the Woodlands assets covered under the loss share agreements, (iii) $60 million on the Horizon assets covered under the loss share agreements, (iv) $66 million on the Chestatee assets covered under the loss share agreements and (v) $66 million on the Oglethorpe assets covered under the loss share agreements, the Bank may be required to reimburse the FDIC for certain amounts under the clawback provisions of the loss share agreements.

Trust and Wealth Management Services. The Company offers a broad array of trust and wealth management services from its headquarters in Little Rock, Arkansas, with additional staff in Rogers, Arkansas. These trust and wealth management services include personal trusts, custodial accounts, investment management accounts, retirement accounts, corporate trust services including trustee, paying agent and registered transfer agent services, and other incidental services. As of December 31, 2010 total trust assets were approximately $1.01 billion compared to approximately $870 million as of December 31, 2009 and approximately $630 million as of December 31, 2008.

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10qk
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