Bank of the Ozarks (OZRK, Financial) filed Annual Report for the period ended 2011-12-31.
Bank Ozarks has a market cap of $1.01 billion; its shares were traded at around $29.57 with a P/E ratio of 15.7 and P/S ratio of 8.6. The dividend yield of Bank Ozarks stocks is 1.5%. Bank Ozarks had an annual average earning growth of 12.7% over the past 10 years.
Under the Arkansas Banking Code of 1997, the acquisition by the Company of more than 25% of any class of the outstanding capital stock of any bank located in Arkansas would require approval of the Arkansas State Bank Commissioner (the Bank Commissioner). Further, no bank holding company may acquire any bank if after such acquisition the holding company would control, directly or indirectly, banks having 25% of the total bank deposits (excluding deposits from other banks and public funds) in the State of Arkansas. In addition, a bank holding company cannot own more than one bank subsidiary if any of its bank subsidiaries has been chartered for less than five years.
The Companys loan and lease portfolio is comprised of a significant amount of real estate loans, including a large number of construction/land development and non-farm/non-residential loans. Excluding loans covered by FDIC loss share agreements, the Companys real estate loans comprised 88.1% of its total loans and leases at December 31, 2011. In addition, excluding loans covered by FDIC loss share agreements, the Companys construction/land development and non-farm/non-residential loans, which are a subset of its real estate loans, comprised 25.4% and 37.6%, respectively, of the Companys total loan and lease portfolio at December 31, 2011. Real estate loans, including construction/land development and non-farm/non-residential loans, pose different risks than do other types of loan and lease categories. The Company believes it has established appropriate underwriting procedures for its real estate loans, including construction/land development and non-farm/non-residential loans, and has established appropriate allowances to cover the credit risk associated with such loans. However, there can be no assurance that such underwriting procedures are, or will continue to be, appropriate or that losses on real estate loans, including construction/land development and non-farm/non-residential loans, will not require additions to its allowance for loan and lease losses, and could have an adverse impact on the Companys financial position, results of operations or liquidity.
The FDICs initial approach to loss sharing provided for indemnification by the FDIC of the acquiring institution against loss equal to 80% of losses with respect to covered assets of the acquired institution up to a stated threshold and 95% of losses incurred by the acquiring institution with respect to such covered assets above the stated threshold. The FDIC modified its policy for transactions occurring after March 31, 2010 where the FDIC provides loss share assistance, and the indemnification in such transactions covers only 80% of all losses with respect to covered assets and no longer covers 95% of such losses above a stated threshold. In August 2010, the FDIC further modified its policy for loss share assistance whereby the FDIC, depending on the size of the failing institution, may (i) establish up to three separate tranches for both single family residential real estate loans and related foreclosed assets and for non-single family residential real estate loans and related foreclosed assets and (ii) provides loss share assistance at varying levels for each of the tranches. In addition, certain consumer loans and certain government-guaranteed loans are not covered by FDIC loss sharing agreements. These modifications of the indemnification protection increase the risk of loss to acquiring institutions in FDIC-assisted acquisitions and could result in a material adverse effect on the Companys financial condition, results of operations or liquidity. There can be no assurance that the FDIC will not alter other terms of the loss share agreements in any future transactions, which could further increase the risks to the Company in the event it engages in any future FDIC-assisted acquisitions.
At December 31, 2011 the Company had substantial unused borrowing availability. This availability was primarily comprised of the following four options: (i) $647 million of available blanket borrowing capacity with the FHLB, (ii) $93 million of investment securities available to pledge for federal funds or other borrowings, (iii) $123 million of available unsecured federal funds borrowing lines and (4) up to $77 million of available borrowing capacity from borrowing programs of the FRB.
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Bank Ozarks has a market cap of $1.01 billion; its shares were traded at around $29.57 with a P/E ratio of 15.7 and P/S ratio of 8.6. The dividend yield of Bank Ozarks stocks is 1.5%. Bank Ozarks had an annual average earning growth of 12.7% over the past 10 years.
Highlight of Business Operations:
Enforcement Authority. The FRB has enforcement authority over bank holding companies and non-banking subsidiaries to forestall activities that represent unsafe or unsound practices or constitute violations of law. It may exercise these powers by issuing cease-and-desist orders or through other actions. The FRB may also assess civil penalties in amounts up to $1 million for each days violation against companies or individuals who violate the BHCA or related regulations. The FRB can also require a bank holding company to divest ownership or control of a non-banking subsidiary or require such subsidiary to terminate its non-banking activities. Certain violations may also result in criminal penalties. For purposes of enforcing the designated consumer financial protection laws, (i) the CFPB has primary enforcement authority over banks with total assets greater than $10 billion and their affiliates, and (ii) a banks primary federal regulators retain exclusive enforcement authority over banks with $10 billion or less in total assets and their affiliates.Under the Arkansas Banking Code of 1997, the acquisition by the Company of more than 25% of any class of the outstanding capital stock of any bank located in Arkansas would require approval of the Arkansas State Bank Commissioner (the Bank Commissioner). Further, no bank holding company may acquire any bank if after such acquisition the holding company would control, directly or indirectly, banks having 25% of the total bank deposits (excluding deposits from other banks and public funds) in the State of Arkansas. In addition, a bank holding company cannot own more than one bank subsidiary if any of its bank subsidiaries has been chartered for less than five years.
The Companys loan and lease portfolio is comprised of a significant amount of real estate loans, including a large number of construction/land development and non-farm/non-residential loans. Excluding loans covered by FDIC loss share agreements, the Companys real estate loans comprised 88.1% of its total loans and leases at December 31, 2011. In addition, excluding loans covered by FDIC loss share agreements, the Companys construction/land development and non-farm/non-residential loans, which are a subset of its real estate loans, comprised 25.4% and 37.6%, respectively, of the Companys total loan and lease portfolio at December 31, 2011. Real estate loans, including construction/land development and non-farm/non-residential loans, pose different risks than do other types of loan and lease categories. The Company believes it has established appropriate underwriting procedures for its real estate loans, including construction/land development and non-farm/non-residential loans, and has established appropriate allowances to cover the credit risk associated with such loans. However, there can be no assurance that such underwriting procedures are, or will continue to be, appropriate or that losses on real estate loans, including construction/land development and non-farm/non-residential loans, will not require additions to its allowance for loan and lease losses, and could have an adverse impact on the Companys financial position, results of operations or liquidity.
The FDICs initial approach to loss sharing provided for indemnification by the FDIC of the acquiring institution against loss equal to 80% of losses with respect to covered assets of the acquired institution up to a stated threshold and 95% of losses incurred by the acquiring institution with respect to such covered assets above the stated threshold. The FDIC modified its policy for transactions occurring after March 31, 2010 where the FDIC provides loss share assistance, and the indemnification in such transactions covers only 80% of all losses with respect to covered assets and no longer covers 95% of such losses above a stated threshold. In August 2010, the FDIC further modified its policy for loss share assistance whereby the FDIC, depending on the size of the failing institution, may (i) establish up to three separate tranches for both single family residential real estate loans and related foreclosed assets and for non-single family residential real estate loans and related foreclosed assets and (ii) provides loss share assistance at varying levels for each of the tranches. In addition, certain consumer loans and certain government-guaranteed loans are not covered by FDIC loss sharing agreements. These modifications of the indemnification protection increase the risk of loss to acquiring institutions in FDIC-assisted acquisitions and could result in a material adverse effect on the Companys financial condition, results of operations or liquidity. There can be no assurance that the FDIC will not alter other terms of the loss share agreements in any future transactions, which could further increase the risks to the Company in the event it engages in any future FDIC-assisted acquisitions.
At December 31, 2011 the Company had substantial unused borrowing availability. This availability was primarily comprised of the following four options: (i) $647 million of available blanket borrowing capacity with the FHLB, (ii) $93 million of investment securities available to pledge for federal funds or other borrowings, (iii) $123 million of available unsecured federal funds borrowing lines and (4) up to $77 million of available borrowing capacity from borrowing programs of the FRB.
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