Bank Ozk · NASDAQ:OZK
Bank Ozk — Investor Presentation (November 2022)
35 slides from Bank Ozk's investor presentation, Nov 8, 2022
Slide 1: Form 8-K Current Report - Bank OZK
UNITED STATES FEDERAL DEPOSIT INSURANCE CORPORATION Washington, D.C. 20429 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of report (Date of earliest event reported): November 8, 2022 BANK OZK (Exact name of registrant as specified in its charter)
Slide 2: Item 7.01 Regulation FD Disclosure
Item 7.01 Regulation FD Disclosure Bank OZK (the “Company”) has updated its Investor Presentation to reflect Third Quarter 2022 financial information and other data. A copy of the Company’s Investor Presentation is furnished as Exhibit 99.1 to this Current Report on Form 8-K. The information furnish
Slide 3: Signatures and Exhibit Index
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. BANK OZK Date: November 8, 2022 By: /s/ Tim Hicks Name: Tim Hicks Title: Chief Financial Officer EXHIBIT
Slide 4: Bank OZK Investor Presentation November 2022
Exhibit 99.1 Nasdaq: OZK | November 2022
Slide 5: Forward-Looking Information
Forward-Looking Information This presentation and other communications by Bank OZK (the “Bank”) include certain “forward-looking statements” regarding the Bank’s plans, expectations, thoughts, beliefs, estimates, goals and outlook for the future that are intended to be covered by the Private Securit
Slide 6: Bank OZK - At a Glance
Bank OZK (Nasdaq: OZK) – At a Glance Financial Highlights* Provide Exceptional Total assets $26.2 billion Pursue Excellence Customer Total loans $19.5 billion Experiences Total deposits $20.4 billion 9M22 Net Interest Margin 4.60% 9M22 Efficiency Ratio 36.9% The OZK Way 9M22 Net Charge-o
Slide 7: Key Investment Considerations
Key Investment Considerations Asset Quality Profitability Diversification & Liquidity & Capital Growth Maintaining excellent Our profitability is Our loan portfolio is We maintain diverse asset quality through powered by our high- diversified, both by sources of liquidity and disciplined application
Slide 8: Asset Quality Consistently Better than the Industry Average
Asset Quality Consistently Better than the Industry Average Net Charge-Off Ratio (%) (All data annualized where appropriate) 2.52 2.55 Net Charge-off Ratios: 3Q22 9M22 ● Non-purchased loans: 0.09% 0.07% 1.75 ● Purchased loans: -0.29% -1.40% 1.55 ● Total loans: 0.09% 0.03% 1.29 1.10 0.97 0.83 0.78 0.
Slide 9: Nonperforming Loans and Loans Past Due
Our Favorable Ratios of Nonperforming Loans, Nonperforming Assets and Loans Past Due Provide Meaningful Data Points on our Asset Quality OZK NPLs ($) OZK NPLs / Non-purchased Loans (%) FDIC Industry Data (%)* Asset Quality Overview $100 6.0% $80 5.0% 4.0% $60 3.0% ($ millions) Our ratios for nonperf
Slide 10: Provision and Allowance for Credit Losses
Provision and Allowance for Credit Losses (“ACL”) Our provision for credit losses was $39.8 million for the third quarter and $51.0 million for the first Scenario Forecast Overview nine months of 2022 compared to negative provision for credit losses of $7.5 million for the third quarter and $69.9 mi
Slide 11: Net Interest Income Is Our Largest Category of Revenue
Net Interest Income Is Our Largest Category of Revenue • As shown below, our net interest income for the third quarter of 2022 was a quarterly record $294.6 million, an 18.8% increase from the third quarter of 2021, and a 10.8% increase from the second quarter of 2022. • Net interest income for the
Slide 12: Loans Are Our Largest Category of Earning Assets
Loans Are Our Largest Category of Earning Assets $19,104 Loan Portfolio Overview $20,000 $18,420 $18,401 $17,979 $17,612 $17,707 $17,792 $18,450 $18,298 10.00% Non-Purchased Loans* Non-Purchased Loan Yield 8.00% $15,000 6.00% ($ millions) $10,000 6.32% 5.46% 5.39% 5.83% 5.37% 5.55% 4.00% 5.15% 5.27%
Slide 13: Investment Securities Are Our Second Largest Category of Earning Assets
Investment Securities Are Our Second Largest Category of Earning Assets • As illustrated below, at September 30, 2022, our investment securities portfolio was $3.53 billion, a decrease of $0.32 billion, or 8.3%, as compared to September 30, 2021 and $0.18 billion, or 4.8%, as compared to June 30, 20
Slide 14: Net Interest Margin Trends
Net Interest Margin Trends • During the quarter just ended, our yield on average earning assets increased more than our cost of interest bearing liabilities. As a result, our net interest margin improved to 5.03%, an increase of 51 bps from the second quarter of 2022. Net Interest Margin vs. the Ind
Slide 15: Core Spread and Cost of Interest Bearing Deposits
Our Core Spread and Cost of Interest Bearing Deposits (“COIBD”) • Our core spread in the quarter just ended improved to 5.73%, an increase of 47 bps from the second quarter of 2022. This resulted from our yield on non- purchased loans increasing 77 bps, while our COIBD increased just 30 bps. Core Sp
Slide 16: Efficiency Ratio Trends
Efficiency Ratio Trends Efficiency Ratio (%) vs. the Industry 70.0% 63.2 61.4 60.4 61.9 60.6 60.0 61.0 58.7 60.0% 50.0% 41.8 40.1 38.6 39.6 38.4 38.2 37.1 37.3 35.5 40.0% 30.0% 20.0% 10.0% 0.0% 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 Bank OZK FDIC Insured Institutions* We have consistently been
Slide 17: Earning Asset Growth Engines & Diversification
Earning Asset Growth Engines & Diversification 14
Slide 18: Loan Portfolio Diversification - Non-purchased Loan Growth
Loan Portfolio Diversification – Non-purchased Loan Growth We are pleased to see the growth year-to-date in Community Banking, Indirect RV & Marine, Corporate & Business Specialties Group (“CBSG”) and Asset Based Lending Group (“ABLG”) and their contributions to greater portfolio diversification. We
Slide 19: Real Estate Specialties Group - Our Largest Growth Engine
Real Estate Specialties Group (“RESG”) – Our Largest Growth Engine Portfolio Importance Portfolio Statistics – as of September 30, 2022 RESG Loans at September 30, 2022 accounted for: Total funded balance $11.48 Billion • 60% of our funded non-purchased loans Total funded & unfunded commitment $29.0
Slide 20: RESG Origination Trends by Year of Origination
RESG Origination Trends by Year of Origination (Total Commitment) The table below illustrates the cadence of RESG loan originations and repayments. It shows the amount of each year’s originations which have been repaid and which remain as outstanding commitments, both funded and unfunded, as of Sept
Slide 21: Recent Trends in RESG Loan Originations and Repayments
Recent Trends in RESG Loan Originations and Repayments Quarterly RESG Originations ($ billions) Quarterly RESG Repayments ($ billions) Q1 Q2 Q3 Q4 Total* Q1 Q2 Q3 Q4 Total* FY2017 $2.30 $2.04 $2.21 $2.56 $9.11 FY2017 $0.57 $0.98 $0.87 $1.45 $3.86 FY2018 $1.00 $1.19 $1.47 $1.08 $4.74 FY2018 $0.79 $1.
Slide 22: Changes in Funded Balance of RESG Loans and Unfunded Balance
Changes in the Funded Balance of RESG Loans and Our Total Unfunded Balance for the Third Quarter and First Nine Months of 2022 Third Quarter of 2022 First Nine Months of 2022 $20.00 $20.00 Activity in $15.00 $15.00 $5.04 ($4.93) RESG $1.68 ($1.28) $10.00 $10.00 Funded Balances $5.00 $11.08 $11.48 $5
Slide 23: RESG Portfolio Diversity by Product Type
RESG’s Nationwide Influence Across Multiple Product Types Provides Exceptional Portfolio Diversification RESG Portfolio Diversity by Product Type – as of September 30, 2022 Total Commitment ($ millions) and Leverage $9,000 100% Total Commitment Loan-to-cost * Loan-to-value * $8,000 90% Total Commitm
Slide 24: Total Commitment by Metropolitan Area
Total Commitment* ($ millions) $- $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 New York-Newark-Jersey City, NY-NJ-PA $3,923 Miami-Fort Lauderdale-West Palm Beach, FL $2,442 Los Angeles-Long Beach-Anaheim, CA $2,055 Boston-Cambridge-Newton, MA-NH $2,030 San Diego-Carlsbad, CA $1,533 Chicago-Naperville-E
Slide 25: RESG Portfolio By Origination Date & LTV
RESG Portfolio By Origination Date & LTV (As of September 30, 2022) Assuming full funding of every RESG loan, as of September 30, 2022, the weighted average LTC for the RESG portfolio was a conservative 53.4%, and the weighted average LTV was even lower at just 42.5%. The LTV metrics on individual l
Slide 26: RESG Portfolio Includes Loans of Many Different Sizes
The RESG Portfolio Includes Loans of Many Different Sizes ($ millions) Commitment Size Tranches No. of Funded Total Tranche Loans Balance Commitment $20,000 100% $0 - $125mm 276 $ 5,981 $ 14,407 Funded Balance ($ millions) Unfunded Commitment ($ millions) LTV Ratio* (%) LTC Ratio* (%) $125+ mm - $25
Slide 27: Community Bank Lending - Important Growth Engine
Community Bank Lending – An Important & Well-Established Growth Engine Community Banking Business Model • Our Community Banking loans, which accounted for 25% of the funded balance of non-purchased loans as of September 30, 2022, include consumer and small business loans, loans originated by our com
Slide 28: Indirect RV & Marine Lending - A Nationwide Business
Indirect RV & Marine Lending – A Nationwide Business Indirect RV & Marine lending (“ILD”) is a nationwide business that ILD Trends has allowed us to originate consumer loans while maintaining our conservative credit-quality standards. $3,000 • Indirect RV & Marine lending is a $2,750 nationwide busi
Slide 29: Deposit Growth, Liquidity and Strong Capital Position
Deposit Growth, Abundant Sources of Liquidity and Strong Capital Position 26
Slide 30: Deposits and Liquidity
Deposits and Liquidity We have worked to improve the mix and quality of our deposit base by focusing significant efforts on growing our consumer and commercial noninterest bearing and other non-time deposits. We believe that we have significant capacity for future deposit growth, including core depo
Slide 31: Strong Capital Position
Strong Capital Position CET 1 Capital Ratio Tier 1 Capital Ratio 20.00% 20.00% 18.00% 18.00% 16.00% 16.00% 14.00% 14.00% 12.95% 11.88% 12.00% 12.00% 10.00% 10.00% 8.00% 8.00% 6.00% 6.00% 4.00% 4.00% 2.00% 2.00% 0.00% 0.00% 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q
Slide 32: Building Capital and Delivering for Shareholders
Building Capital and Delivering for Shareholders $35.67 $40.00 As of September 30, 2022, our book value and $30.02 BVPS TBVPS $35.00 tangible book value per share were $35.67 and Book Value $30.00 $30.02, respectively. and Tangible $25.00 Over the last 10 years, we have increased book Book Value $20
Slide 33: Non-GAAP Reconciliations
Non-GAAP Reconciliations 30
Slide 34: Non-GAAP Reconciliations
Non-GAAP Reconciliations Calculation of Total Common Stockholders’ Equity, Total Tangible Common Stockholders’ Equity and Tangible Book Value per Share Unaudited (Dollars in Thousands, Except per Share) Represents ending balances, as determined in accordance with accounting principles generally acce
Slide 35: BankOZK
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