Dan Thomas, 54, the vice chairman of Bank of the Ozarks and president of the bank's real estate specialties group which has closed more than $25 billion in loans, announced his resignation on Thursday.
After the announcement Bank of the Ozarks shares fell $5.83, or 12.3 percent, to close at $41.74 in trading on the Nasdaq exchange. More than 9.1 million shares were traded, about six times its average volume of 1.5 million shares. The bank lost more than $700 million of its value Friday.
"Based on the trading activity above the normal trading volume and the drop in market value of shares of Bank of the Ozarks, investors have reacted negatively to the resignation of Dan Thomas," said Garland Binns, a Little Rock banking attorney.
Thomas joined the bank in 2003, became president of the real estate specialties group in 2005 and vice chairman in 2013.
He gave no indication why he resigned or what his plans are.
"I have enjoyed being a part of a commercial lending team that has closed over $25 billion in financings since its inception," Thomas said in his letter. "While the volume is nice, I am more proud of the fact that the portfolio has been built utilizing incredible discipline -- including the utilization of very low leverage with best in class sponsorship. In addition, the team is very talented and experienced."
Bank of the Ozarks currently has more than $12 billion in outstanding real estate loans in about 30 states.
Attempts to contact Thomas were unsuccessful.
With the news, Matt Olney, a banking analyst in Little Rock with Stephens Inc., lowered his rating of the bank from buy to hold.
"Mr. Thomas has been a key architect behind [Bank of the Ozarks' real estate specialties group] strategy that now represents 70 percent of originated loans," Olney said Friday in a research brief. "We expect this news to create an overhang for the stock's valuation until the bank's growth outlook is assured."
As part of a filing with the federal Securities and Exchange Commission, Bank of the Ozarks said it reassigned Thomas' duties "in accordance with the management succession plan previously approved by the board."
The bank said that with the depth of the company's management team at the real estate specialties group, it doesn't expect Thomas' resignation to have a material impact on the long-term prospects of the group.
Bank of the Ozarks has had success executing succession plans in the past and continued to do well, said Randy Dennis, president of DD&F Consulting Group, a Little Rock bank consulting firm.
"You hate to lose good people," Dennis said. "But I would be very surprised if they miss many heartbeats."
Brian Martin, a banking analyst with Atlanta-based FIG Partners, does not expect Thomas' resignation to have much impact.
"While Mr. Thomas had significant oversight at [real estate specialties group], we would not be surprised to see a more decentralized management structure implemented given the breadth and depth of talent at the operation," Martin said in a research report.
The bank paid Thomas $4.7 million last year, second only to the $6.2 million Chairman George Gleason was paid.
Business on 07/29/2017